Concerning foreign exchange trading, a "futures contract" is characterized by which of the following?
A) The size of the contract is standardized in round lots.
B) The contract's costs are based on bid/offer spread.
C) Trading happens over the counter by telephone.
D) The date of delivery is negotiable.

Question

Quizplus · Accepted Answer

A futures contract is characterized by a standardized size, which is typically referred to as a round lot. This standardization allows for easier trading and ease of comparison between different contracts. The costs of the contract are based on a bid/offer spread, but this is not the defining characteristic of a futures contract. Trading happens on organized exchanges, not over the counter by telephone. The date of delivery is also standardized and not negotiable.

Concerning Foreign Exchange Trading, a "Futures Contract" Is Characterized by Which