Forward contracts are individually designed agreements and can be tailored to the specific needs of the ultimate end-user.

Question

Quizplus · Accepted Answer

Forward contracts are indeed individually designed and can be customized to meet the specific requirements and preferences of the parties involved in the transaction. This level of flexibility is one of the main advantages of using forward contracts, as it allows the parties to agree on the exact terms of the deal and manage their respective risks more effectively. Moreover, forward contracts do not have standardized features, unlike futures contracts, which makes them more adaptable to the needs of the ultimate end-users.

Forward Contracts Are Individually Designed Agreements and Can Be Tailored