The extract below is from commodities in Volume 6, Reading 46, Example 8. I’m less interested in the answer or question, and more interested in how they define A (arbitrageurs) and C (informed investors). Are informed investors equivalent to speculators? If so, the below descriptions sound identical to me, so how are informed investors, speculators and arbitrageurs different? Thanks!!! A is incorrect because arbitrageurs typically seek to capitalize and profit on mispricing due to a lack of information in the marketplace. C is incorrect because informed investors predominantly keep commodity futures markets efficient by capitalizing on mispricing attributable to a lack of information in the marketplace.
(Institute 204)
Institute, CFA. 2018 CFA Program Level II Volume 6 Alternative Investments and Portfolio Management. CFA Institute, 07/2017. VitalBook file.
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