A derivative instrument that suggests a contract between two traders for purchase and delivery of assets at a specific time and future date but is not traded on stock exchange.

RISK MANAGEMENT

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	swaps
B	futures
C	forwards
D	None of the above

Explanation:

Detailed explanation-1: -Futures. A futures contract, or simply futures, is an agreement between two parties for the purchase and delivery of an asset at an agreed-upon price at a future date. Futures are standardized contracts that trade on an exchange.

Detailed explanation-2: -A forward contract is a customizable derivative contract between two parties to buy or sell an asset at a specified price on a future date. Forward contracts can be tailored to a specific commodity, amount, and delivery date.

Detailed explanation-3: -Futures contracts are financial derivatives that oblige the buyer to purchase some underlying asset (or the seller to sell that asset) at a predetermined future price and date.

Detailed explanation-4: -Futures contracts are standardized financial contracts that allow holders to buy or sell an underlying asset or commodity at a certain price in the future, which is locked in today.

There is 1 question to complete.

BUISENESS MANAGEMENT

RISK MANAGEMENT