If Funds Rise Above the Initial Margin Requirement as a Result

question 35

Multiple Choice

If funds rise above the initial margin requirement as a result of marking to market, they may be

• A) automatically rolled over to purchase more of the same futures contracts
• B) withdrawn by the clearinghouse and placed in an interest-bearing account
• C) used to satisfy undermargined positions in other contracts
• D) withdrawn by the investor

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Definitions:

Annuity

An annuity is a financial product that pays out a fixed stream of payments to an individual, typically used as an income stream for retirees.

Payments

Transactions made by individuals or entities to fulfill obligations or purchase goods and services.

Compounded Monthly

A method of calculating interest where the interest earned each month is added to the principal, thus earning interest in subsequent months.

RRSP

Registered Retirement Savings Plan, a Canadian account for holding savings and investment assets with tax benefits for retirement.