Which party initiates the trade of a futures contract?Question 8Select one:The person desiring a long futures position.The person desiring a short futures position.A futures position can be initiated either by someone wanting to go long or short.The futures exchange is the party that initiates all futures trades.

What is a futures contract?*1 pointa. A contract that gives the holder the right to buy an asset at a specific priceb. A contract that obligates the holder to sell an asset at a specific pricec. A contract that gives the holder the right to sell an asset at a specific priced. A contract that obligates the holder to buy an asset at a specific price

Which of the following statements about futures are false:I. Long position occurs when the futures contract is initially sold and subsequently bought in future;II. In Australia bonds futures are usually quoted at an index figure of 100 minus the yield so a dealer can follow a basic principle of buy low and sell high;III. Novation is the process to renew futures contracts when they fall due;IV. Short position implies selling asset at a future date and correspondingly selling futures contract today.

In the futures markets, if a futures contract is marked-to-market, this refers to the:Question 3Select one:a.interaction of the demand and supply forces in the market to determine the price of the options contract.b.interaction of the demand and supply forces in the market to determine the price of the futures contract.c.settlement of gains and losses on futures contracts on a daily basis.d.settlement of gains and losses on forward contracts on a daily basis.

Which of the following is TRUE? To hedge a natural short position with futures, the hedger should: a. Initially sell the futures contract and then buy the same contract at the delivery date. b. Initially buy the futures contract and then sell the same contract before the delivery date. c. Initially buy the futures contract and then sell the same contract after the delivery date. d. Initially buy the futures contract and then sell the same contract at the delivery date.

Which of the following is NOT a type of futures contract?*1 pointa) Stock futuresb) Bond futuresc) Mutual fund futuresd) Currency futures