What Happens to the Price of a Futures Contract as Expiration

question 112

Multiple Choice

What happens to the price of a futures contract as expiration draws closer?

• A) It exceeds the spot price of the asset.
• B) It is exceeded by the spot price of the asset.
• C) It approaches the spot price of the asset.
• D) There is no relationship between futures price and spot price as the contract approaches expiration.

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Definitions:

Venice

A historic city in Italy, famous for its canals, architecture, and rich cultural heritage, often referenced in art and literature.

Empress Theodora

A powerful and influential empress of the Byzantine Empire, and wife of Emperor Justinian I, known for her political acumen and support of women's rights.

San Vitale

A church in Ravenna, Italy, known for its remarkable early Christian Byzantine art and mosaics.

Choir Wall

The architectural element that separates the choir, the area where the altar is located, from the nave or main body of the church, often found in Christian churches.