What Is a Futures Contract? How Do They Differ from Forward

question 79

Essay

What is a futures contract? How do they differ from forward contracts? Explain the positions that can be established in a futures contract and how they are used by traders.

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Definitions:

Capital Structure

A company's use of both borrowed money and stocks to finance its ongoing operations and grow.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Capital Structure

The fusion of equity and debt resources a firm applies to underwrite its operational needs and scalability.

Working Capital Decision

The process of managing the short-term assets and liabilities of a firm to ensure it operates efficiently and can meet its obligations.