Which of the Following Is NOT an Advantage of Using

question 57

Multiple Choice

Which of the following is NOT an advantage of using futures contracts to hedge an exposure compared to using forward contracts to hedge the same exposure?

• A)Futures hedges are easier to unwind.
• B)Futures have very low transaction costs.
• C)Futures offer greater flexibility in terms of contract features.
• D)Futures generally have more liquid markets.
• E)Futures generally offer greater efficiency.

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Definitions:

Trespass to Land

An unauthorized physical intrusion onto someone else's property.

Unauthorized

Actions or accesses that are not permitted or approved by the rightful owner or authority.

Intrusion

A violation of someone's space or privacy without their consent.

Public Nuisance

An act or omission that obstructs, damages, or inconveniences the rights of the community or the general public.