SIE Exam Practice Question 417
Question: 417
When investors put their capital at risk, they rely upon the input and advice of their financial advisors, persons associated with a broker-dealer who have been trained in the field of investments and investment risks. As a concept, hedging has its primary purpose:
Correct Answer: B
Explanation:
B: Hedging investment risks involves strategies to mitigate and to reduce exposure to investment loss. Hedging is not a concept of maximizing profits.
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