An investor requires 100oz of gold in 12 months time. Based on the information below, should an investor purchase gold i

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answerhappygod
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An investor requires 100oz of gold in 12 months time. Based on the information below, should an investor purchase gold i

Post by answerhappygod »

An investor requires 100oz of gold in 12 months time. Based on
the information below, should an investor purchase gold in the spot
market incurring the associated costs, or buy the 12-month futures
contract?
Answers
Purchase in the spot market and incur costs for the year
totaling $175,321.60
Purchase in the futures market for $178,600
Purchase in the spot market for $163,200 and incur no costs
throughout the year
Purchase in the futures market for higher than $178,600
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