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WorksheetsMBFC 4043 (21/7/2021)
Total questions: 10
Worksheet time: 2mins
The followings are the criteria for a viable futures market EXCEPT;
Easy grading
Deep market
Free fluctuation
Inactive market
Two functions of derivatives market are;
Expiry date
Price discovery
hedging mechanism
Risk
Tick the participants of futures market.
Arbitrageur
Hedgers
Speculators
Spreaders
Define the initial margin?
The counterparty for both seller and buyer.
The losses in the futures contract- balance in the account fall below the maintenance margin.
The amount of equity required to retain an open position.
The minimum account balance required before an investor will be approved to buy or sell a futures contract or when the contract is entered into.
Which one of the following is categorized as soft commodity?
Soybeans
Metal
Energy gas
Gold
(a) is intangible in nature.
The three characteristics of financial futures are _______________________.
Cash settlement.
Cannot be delivered physically.
Tangible.
Do not have storage value.
Long position means that ____________________.
Hold position
Selling position
Buying position
The followings are TRUE about volume EXCEPT;
the number of contracts traded.
total purchases and sales for a given contract month.
the term is similar to the stock market term.
number of outstanding contracts for a given contract month
You are gaining ____________ if you SELL now at higher price and then proceed with BUY back at lower price.
Loss
Profit
break-even profit
