Which of these transactions likely resulted in an investment

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Herbert Corporation was a party to the following transactions during November and December of the current year. Which of these transactions most likely resulted in an investment in a derivative?

Purchased 1,000 common shares of a public corporation for cash based on the assumption that they will increase in value.

Purchased a term life insurance policy on the company's chief executive officer to protect the company from the effects of an untimely demise of this officer.

Agreed to cosign the note of its 100%-owned subsidiary to protect the lender from the possibility that the subsidiary might default on the loan.

Based on its forecasted need to purchase 300,000 bushels of wheat in 3 months, entered into a 3-month forward contract to purchase 300,000 bushels of wheat to protect itself from changes in wheat prices during the period.

Reference no: EM132315611

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