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Is It True That Forward Contracts Are Always Riskier Than

question 16

Essay

Is it true that forward contracts are always riskier than the futures contracts? If so,will there be any forward contracts in a practical world?


Definitions:

Legal Standard

A principle or guideline established by law that is used to judge the legality of actions or decisions in judicial and administrative proceedings.

Intentional Intrusion

Deliberate entry or infringement upon another's privacy or property without consent or legal justification.

Reasonable Person

A legal standard representing how a typical person, with ordinary prudence, would act in certain circumstances.

Constitution

The system of fundamental principles or established precedents according to which a state or other organization is governed.

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