Question
Which of the following is NOT a difference between a currency futures contract and a forward contract? The futures contract is marked to market daily,
Which of the following is NOT a difference between a currency futures contract and a forward contract?
The futures contract is marked to market daily, whereas the forward contract is only due to be settled at maturity. | ||
The counterparty to the futures participant is unknown with the clearinghouse stepping into each transaction, whereas the forward contract participants are in direct contact setting the forward specifications. | ||
A single sales commission covers both the purchase and sale of a futures contract, whereas there is no specific sales commission with a forward contract because banks earn a profit through the bid-ask spread. | ||
All of these are true. |
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