Difference between options and futures


Response to the following problem:

"There's no real difference between options and futures. Both are hedging tools, and both are derivative products. It's just that with options you have to pay an option premium, whereas futures require no upfront payment except for a ‘good faith' margin. I can't understand why anyone would use options." Do you agree with this statement?

Solution Preview :

Prepared by a verified Expert
Accounting Basics: Difference between options and futures
Reference No:- TGS02078605

Now Priced at $20 (50% Discount)

Recommended (93%)

Rated (4.5/5)