Basis Risk on a Futures Contract Is

question 546

Multiple Choice

Basis risk on a futures contract is:

• A) The risk of an adverse change in the futures price
• B) The risk of an adverse change in the spread between futures and cash prices
• C) The progressive illiquidity of a futures contract as it approaches expiry
• D) The risk of a divergence between the futures price and the final fixing of the underlying interest rate

---

Definitions:

Voice Recognition Systems

Technology that enables computers and other devices to receive and interpret dictations or understand spoken commands.

Workplace Issues

Problems or challenges that arise in the context of a work environment, possibly affecting employees' performance and well-being.

Distraction

Anything that diverts attention away from the primary task or focus, often leading to a decrease in performance or productivity.

Etiquette

The customary code of polite behavior in society or among members of a particular profession or group.