Which of the following is correct?

1. Forward contracts are traded in exchange-traded derivatives markets
2. Forward contracts are subject to monthly settlement
3. Forward Price (F₀) is contracted now and will be used for a transaction in the future
4. Forward contracts have no default risk

Which of following should be used by investors to hedge against a decrease in the S&P index?

1. Long Futures on the S&P index
2. Long Call Options on the S&P index
3. Short Futures on the S&P index
4. Long Forward on the S&P index