A key characteristic of forward contracts that recommends their use over futures contracts is:
A) forwards are not traded on exchanges and marked-to-market.
B) forward contracts allow flexibility with respect to contract period.
C) forwards are not standardised instruments with regard to the amount of each contract.
D) all of the given answers.

Question

Quizplus · Accepted Answer

Forward contracts offer flexibility in terms of contract periods and amounts, and they are not traded on exchanges nor marked-to-market daily, distinguishing them from futures contracts.

A Key Characteristic of Forward Contracts That Recommends Their Use