A Currency Futures Option Amounts to a Derivative on a Derivative.Why

question 36

Multiple Choice

A currency futures option amounts to a derivative on a derivative.Why would something like that exist?

• A)For some assets,the futures contract can have lower transaction costs and greater liquidity than the underlying asset.
• B)Tax consequences matter as well,and for some users an option contract on a future is more tax efficient.
• C)Transaction costs and liquidity
• D)all of the options

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