Which of the following is a disadvantage of trading futures contracts?*1 pointa) Low volatilityb) Low transaction costsc) High liquidityd) High leverage

Which of the following is a key advantage of futures contracts over forward contracts?  A. Customizable terms  B. Lack of counterparty risk  C. Standardized terms  D. Settled at the discretion of the parties involved

Which of the following is NOT an advantage of using futures contracts to hedge an exposure compared to using forward contracts to hedge the same exposure? A. Futures generally have more liquid markets. B. Futures generally offer lower counter-party risk. C. Futures are available on a greater range of products. D. Futures have very low transaction costs.

Which of the following best describes the risks associated with futures contracts?Question 10Select one:a.The variability of changing prices and costs associated with buying and selling futures contractsb.The possibility of making an unexpected profit on a futures contractc.The probability of making a loss, or a fall in the value of a futures contractd.The possibility of loss associated with the default by the holder of the opposite position in the contract

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

What is the main purpose of futures contracts?*1 pointa) To provide a guaranteed return on investmentb) To replace traditional investments like stocks and bondsc) To transfer risk from one party to anotherd) To eliminate the need for financial intermediaries