Company B entered the futures market buying a Treasury bond futures contract at the same time that company S sold an identical contract. Company B now wishes to close out its position. Which of the following is not correct?

Multiple Choice

• Because of novation, company B is able to close out without any involvement with company S.

• Company B can close out its position by selling only if company S agrees to buy the contract.

• To close out its position company B must sell an identical bond futures contract.

• If company B leaves the market by closing out, it is able to withdraw the balance in its margin account.

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