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Basic Question 11 of 11
Which of the following statements about forward and future contracts is FALSE?
B. A predetermined price to be paid for a good is a necessary requirement in the terms of a forward contract.
C. The future value of a financial derivative depends on the value of its underlying asset.
D. The primary difference between forwards and futures is that only futures are considered financial derivatives.
A. A future requires the contract purchaser to receive delivery of the good at a specified time.
B. A predetermined price to be paid for a good is a necessary requirement in the terms of a forward contract.
C. The future value of a financial derivative depends on the value of its underlying asset.
D. The primary difference between forwards and futures is that only futures are considered financial derivatives.
User Contributed Comments 1
| User | Comment |
|---|---|
| To-be-CFA | Only D states the difference. |
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Edward Liu
Learning Outcome Statements
define forward contracts, futures contracts, swaps, options (calls and puts), and credit derivatives and compare their basic characteristics
CFA® 2024 Level I Curriculum, Volume 5, Module 2.