Chartered Financial Analyst Level 1

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Which of the following statements is most accurate? In derivatives pricing:

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Last updated: December 6, 2025 at 09:57

A

investors are assumed to be risk averse.

B

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expected payoffs of the derivative can be discounted at the risk-free rate.

C

a portfolio consisting of the underlying and the derivative must earn the risk-free rate plus a risk premium.

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