The benefit of a futures exchange is:
A)elimination of customer risk exposure
B)provision of clearing services
C)guarantee of trading volume
D)intervention on the trader's behalf with government regulators

Question

Quizplus · Accepted Answer

The provision of clearing services is one of the primary benefits of a futures exchange. Clearing services help to reduce counterparty risk by ensuring that both parties involved in a trade have the financial resources to fulfill their obligations. This helps to promote market stability and enhance the overall credibility of the futures exchange. Elimination of customer risk exposure, guarantee of trading volume, and intervention on the trader's behalf with government regulators are not primary benefits of a futures exchange.

The Benefit of a Futures Exchange Is