Read the difference mentioned below and find out how the correct difference between futures contract and forwards contracts: 1. Forward contract involves counter party risk, future contract does not have counter party risk 2. Future contracts are settled on one date, whereas forward contract are settled on different dates 3. Forward contract does not require exchange, futures are traded in stock exchange 4. Future contract are standardized, but forwards has customized contracts.
Read the difference mentioned below and find out how the correct difference between futures contract and forwards contracts: 1. Forward contract involves counter party risk, future contract does not have counter party risk 2. Future contracts are settled on one date, whereas forward contract are settled on different dates 3. Forward contract does not require exchange, futures are traded in stock exchange 4. Future contract are standardized, but forwards has customized contracts.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Q1
Transcribed Image Text:Read the difference mentioned below and find
out how the correct difference between
futures contract and forwards contracts:
1.
Forward contract involves counter party
risk, future contract does not have counter
party risk
2.
Future contracts are settled on one
date, whereas forward contract are settled on
different dates
3.
Forward contract does not require
exchange, futures are traded in stock
exchange
4.
Future contract are standardized, but
forwards has customized contracts.
Transcribed Image Text:ttled on different dates
exchange
Only 2 and 3
Only 4
Only 1.2 and 4
Only 1,2 and 3
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