Which one of the following is a trade that will close out a previously established futures position?
A)maintenance call
B)margin call
C)reverse trade
D)position reversal
E)margin closeout

Question

Quizplus · Accepted Answer

A reverse trade is a trade that is executed in the opposite direction to a previously established futures position. This trade will close out the original position. The other options listed are not trades that would close out a futures position. A maintenance call is a request for additional funds to cover potential losses. A margin call is a demand for immediate payment of funds due to insufficient margin. A position reversal is the act of selling a long position and buying a short position (or vice versa) in the same futures contract. Margin closeout refers to the forced liquidation of a position by a broker due to a customer's inability to meet the margin requirements.

Which One of the Following Is a Trade That Will