Question

Define futures contracts in finance. Why do we need them? Give an example from Commodity, Currency...

Define futures contracts in finance. Why do we need them? Give an example from Commodity, Currency and Financial futures. Also, name one index futures from each category.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

FUTURE CONTRACT IS A CONTRACT BETWEEN TWO WHERE ONE AGREE TO BUY AND OTHER AGREE TO SELL ANY FINANCIAL INSTRUMENT ,COMMODITY , CURRENCY ETC IN FUTURE AT SPECIFIED PRICE/ RATE.

WE USUALLY NEED THEM TO HEDGE OUR POSITION AGAINST LOSSES THAT MAY OCCUR IN FUTURE DUE TO FALL OR INCREASE IN PRICE.

EXAMPLE OF

COMMODITY - OIL , GAS ,PRECIOUS METAL

CURRENCY FUTURE - USD/EURO , USD/GBP ETC

FUTURE INDEX NAMES

COMMODITY - GOLDMAN SACHS COMMODITY INDEX

CURRENCY - US DOLLAR INDEX

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
why do we need behavioral finance? Is it very important for the investors?
why do we need behavioral finance? Is it very important for the investors?
why do we need behavioral finance? Is it very important for the investors?
why do we need behavioral finance? Is it very important for the investors?
1. What is finance and why do we need to study finance? 2. What is the...
1. What is finance and why do we need to study finance? 2. What is the future value of $63,274 if invested at 8% for 20 years compounded annually? 3. Calculate the daily, monthly, and quarterly interest rate for 7%.
What is a corrective tax? Why do we need them? What are the results of a...
What is a corrective tax? Why do we need them? What are the results of a corrective tax? (Please explain your answer by drawing a graph)
Define block pricing and bundling. Give one real world example for each strategy. Discuss why a...
Define block pricing and bundling. Give one real world example for each strategy. Discuss why a firm would use such a strategy
Briefly define the term “earnings and profits.” Why do we need to know about this concept...
Briefly define the term “earnings and profits.” Why do we need to know about this concept of earnings and profits? If we start with “taxable income” can you provide a few of the adjustments that you would need to make in order to get to “earnings & profits” of the Corp?
Discuss the nature of aggregate demand and aggregate supply?   Why do we study them? Give Atleast...
Discuss the nature of aggregate demand and aggregate supply?   Why do we study them? Give Atleast 1 paragraph ( 5-6 sentences) answer
What is CDN? (10) b) Describe why we need it? (5) c) Also, CDNs typically adopt...
What is CDN? (10) b) Describe why we need it? (5) c) Also, CDNs typically adopt one of two different server placement philosophies. Name and briefly describe them. (5) 15) Assume Ahmed using his user agent
Define the terms primary sector, secondary sector and tertiary sector. Give an example of a job...
Define the terms primary sector, secondary sector and tertiary sector. Give an example of a job found in each of the sectors. In which sector(s) are most of the workers found in developing countries? In which sector(s) are most of the workers found in developed countries? Why do countries with high HDI’s generally have low GII’s? Briefly summarize the two paths to development. List and explain two ways the WTO promotes international trade. Also, explain two reason why the WTO...
what are the major groups of mammals? give an example of each group. What characteristics do...
what are the major groups of mammals? give an example of each group. What characteristics do they all share? Why should we care since mammals are one of the least diverse groups of land animals. (Only about 4000 species)
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT