Remove Fear of Buying and Selling | CTFA Exam | ABA

Remove Fear of Buying and Selling

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Question

Which of the following function removes the fear of buying and selling at ripe of price?

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A. B. C. D.

A

The function that removes the fear of buying and selling at ripe of price is the Continuous Pricing Function.

Continuous Pricing Function is a method of setting and updating prices on a continuous basis rather than at fixed intervals. It is used in financial markets to facilitate the buying and selling of securities or other financial instruments.

The function helps to remove the fear of buying and selling at a ripe price by ensuring that the price of the asset is always up-to-date and reflects the latest market conditions. This means that buyers and sellers can be confident that they are getting a fair price for the asset based on the current market conditions.

In contrast, if prices were only updated at fixed intervals, there could be a significant time lag between when the market conditions changed and when the price was updated. This could result in buyers or sellers being uncertain about whether they were getting a fair price, leading to fear and hesitation in buying or selling.

The other options listed are also important functions in financial markets, but they do not directly address the issue of removing the fear of buying and selling at a ripe price.

Fair pricing function ensures that prices are fair to both buyers and sellers, but it does not address the issue of updating prices on a continuous basis.

Economic function refers to the role of financial markets in allocating capital and resources to their most productive uses.

Exchange function refers to the role of financial markets in providing a platform for buyers and sellers to trade securities or other financial instruments.