Explain the Similarities and Differences Between the Forward and Futures

question 45

Essay

Explain the similarities and differences between the forward and futures markets.

---

Definitions:

Values

The numbers, symbols, or expressions that define the magnitude, quantity, or worth of something.

Binomial Probability

The probability of obtaining one of two outcomes (success or failure) in an experiment that is repeated multiple times under identical and independent conditions.

Discrete Random

Refers to a type of variable that can take only specific, separate values, often counted integers, within a defined set.

Distribution

Refers to the way values are spread or distributed over a range of possibilities.