Comparing forward and futures contracts forward contracts


Comparing forward and futures contracts, which of the following statements is (are) FALSE:

I. Since 2007, futures transactions are more likely to be handled through CCPs

II. Futures offer investors lower credit risk (counterparty risk) and offer short hedging companies lower liquidity risk because futures are settled daily via margin accounts

III. Forward contracts are more customizable and a larger percentage of the total derivative market

A) I

B) II

C) III

D) I, II

E) I, II, III

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Financial Management: Comparing forward and futures contracts forward contracts
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