Which is a key difference a manager should note in choosing between forward and futures contracts? a. Exchange trading makes forward contracts more liquid. b. Futures contracts carry standardized terms, while forward contracts can be tailored to meet specific needs. c. Futures contracts have greater default risk than forward contracts. d. Forward contracts require initial margin deposits and daily marking to market, while futures do not
Which is a key difference a manager should note in choosing between forward and futures contracts? a. Exchange trading makes forward contracts more liquid. b. Futures contracts carry standardized terms, while forward contracts can be tailored to meet specific needs. c. Futures contracts have greater default risk than forward contracts. d. Forward contracts require initial margin deposits and daily marking to market, while futures do not
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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Which is a key difference a manager should note in choosing between forward and futures contracts?
a. Exchange trading makes forward contracts more liquid.
b. Futures contracts carry standardized terms, while forward contracts can be tailored to meet specific needs.
c. Futures contracts have greater default risk than forward contracts.
d. Forward contracts require initial margin deposits and daily marking to market, while futures do not.
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