Yield positive riskless arbitrage profits

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A 1-year gold futures contract is selling for $1,645. Spot gold prices are $1,592 and the 1-year risk-free rate is 3%. Based on the above data, which of the following set of transactions will yield positive riskless arbitrage profits?

Buy the futures contract, and buy the gold spot using borrowed money.

Buy gold spot with borrowed money, and buy the futures contract.

Buy gold in the spot with borrowed money, and sell the futures contract.

Buy the futures contract, and sell the gold spot and invest the money earned.

Reference no: EM131074603

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