Which of the following observations is true of futures contracts?
A)They are contracted through a dealer,usually a bank.
B)They are customized to meet contracting company's terms and needs.
C)Future contracts typically do not require a margin deposit.
D)Future contracts are traded on an exchange and acquired through an exchange broker.

Question

Quizplus · Accepted Answer

Futures contracts are traded on an exchange and are acquired through a broker who is a member of that exchange. Option A is incorrect because futures contracts can be contracted through brokers who are not necessarily banks. Option B is incorrect because futures contracts are standardized contracts with set terms and specifications. Option C is incorrect because futures contracts typically require a margin deposit to ensure financial security for both parties.

Which of the Following Observations Is True of Futures Contracts