The spot market is where securities are sold for cash and delivered immediately, whereas forward markets (or derivative markets) the delivery date is different from the negotiation date.

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BlackTom AI · Accepted Answer

The question contrasts the spot market with forward (derivative) markets in terms of delivery timing. 
Option 1: True. The statement that the spot market is where securities are sold for cash and delivered immediately is accurate, since in a spot transaction payment and delivery typically occur promptly (often T+2 for many markets), reflecting immediate settlement. Conversely, forward markets are characterized by a delivery date set in the future, which can differ from the negotiation date; these are often used to hedge price risk and derive value from anticipated price movements, and the actual delivery or settlement occurs at the specified future date or via cash settlement depending on the contract. This aligns with standard definitions of spot versus forward/derivative markets. 
Option 2: False. Interpreting the same statement as false would require asserting that spot markets are not cash-and-carry or that delivery is not immediate, or that forward markets do not involve a future delivery date. Such a view contradicts the conventional distinction between spot markets (immediate cash-and-delivery) and forward/derivative markets (future delivery or settlement). Therefore, labeling the overall statement as false would mischaracterize the fundamental relationship between these markets. 
Additional nuance: Some spot trades may settle with a short lag due to clearing cycles, but the core definition remains that spot involves near-term settlement, while forwards involve a contractual obligation to deliver at a future date. This nuance does not overturn the primary contrast presented in the statement. 
In summary, the true statement accurately reflects the standard definitions, while the false statement would misstate these core characteristics, making it incorrect in light of conventional market terminology.

The spot market is where securities are sold for cash and delivered immediately, whereas forward markets (or derivative markets) the delivery date is different from the negotiation date.

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