Which of the following statements is most CORRECT?
A) futures contracts generally trade on an organized exchange and are marked to market daily.
B) goods are never delivered under forward contracts, but are almost always delivered under futures contracts.
C) there are futures contracts for currencies but no forward contracts for currencies.
D) futures contracts don't have any margin requirements but forward contracts do.
E) one advantage of forward contracts is that they are default free.

Question

Quizplus · Accepted Answer

Futures contracts are traded on organized exchanges and are marked to market daily, which means that the gains or losses are settled on a daily basis. This is not the case for forward contracts, where settlement takes place at the end of the contract period.

Which of the Following Statements Is Most CORRECT