The Major Difference Between Valuing Futures Versus Forward Contracts Stems

question 72

Multiple Choice

The major difference between valuing futures versus forward contracts stems from the fact that future contracts are

• A) Traded on exchange.
• B) Backed by a clearinghouse.
• C) Marked-to-market daily.
• D) Less risky.
• E) Relatively inflexible.

---

Definitions:

Stock Chart

A graphical representation of a stock's price movements over time, used by investors to analyze stock behavior and make investment decisions.

Bubble Chart

A data visualization tool that displays multiple circles (bubbles) in a two-dimensional plot to represent the values of three variables for each observation; the position of each bubble on the horizontal and vertical axes indicates two of the values, while the size of the bubble represents the third.

Categorical Data

Data that represent characteristics and can be divided into groups or categories, which are not numerically quantifiable.

Ordinal Data

Refers to a type of data which is categorized into ordered levels but the differences between the levels are not necessarily consistent or measurable.