A (an)---------- seeks to earn a return without assuming risk by constructing riskless hedges.
A)speculator
B)call writer
C)put writer
D)arbitrageur

Question

Quizplus · Accepted Answer

An arbitrageur seeks to earn a return without assuming risk by constructing riskless hedges. They identify and take advantage of pricing inefficiencies in different markets or securities to make a profit. This involves buying and selling the same asset in different markets to take advantage of price discrepancies. The other options, speculators, call writers, and put writers, all involve taking on some level of risk.

A (An)---------- Seeks to Earn a Return Without Assuming Risk