Question
1.An individual entering into a futures contract can negotiate unique contract specifications such as the type of asset, the quantity of the asset to be
1.An individual entering into a futures contract can negotiate unique contract specifications such as the type of asset, the quantity of the asset to be transacted and the delivery date with the other party. T or F + brief explain
2. Consider a forward contract on Euros with a forward rate of $1.70. On the maturity date, the long party would pay $1.7 million AUD in exchange for 1 million Euros from the short party. If Shane believes the Euro will go up in value, he should enter into a long position on this forward contract. T or F + brief explain
3. A protective put is an investment strategy that involves purchasing an asset and a put on that asset. It guarantees maximum payoff equal to the puts exercise price. T or F + brief explain
4. A closed-end fund currently has a market value of assets of $11 million, market value of liabilities of $2 million and 4 million shares outstanding. Its shares will trade at $2.25. T or F + brief explain
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