If You Determine That the S&P 500 Index Futures Is

If you determine that the S&P 500 Index futures is overpriced relative to the spot S&P 500 Index you could make an arbitrage profit by

A) buying all the stocks in the S&P 500 and selling put options on the S&P 500 index.
B) selling short all the stocks in the S&P 500 and buying S&P Index futures.
C) selling all the stocks in the S&P 500 and buying call options on the S&P 500 index.
D) selling S&P 500 Index futures and buying all the stocks in the S&P 500.
E) none of the above.

Correct Answer:

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