CFA Practice Question

There are 277 practice questions for this topic.

CFA Practice Question

At their initiation, both futures contracts and forward contracts specify ______.

I. the good to be exchanged
II. the price at which the good will be exchanged
III. the time at which the exchange will occur
Correct Answer: I, II and III

The provisions of both futures and forward contracts are determined at the beginning of the contracts. The difference between the two type is that the provisions of futures contracts are standardized while forward contracts are customized. That is, all futures contracts are identical, and all forward contracts are different.

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