Which of the following does not describe a futures contract? Your answer: O Traded competitively on organized exchanges

Finance Dec 21, 2020

Which of the following does not describe a futures contract? Your answer: O Traded competitively on organized exchanges. O Traded by bank dealers via a network of telephones and computerized dealing systems. Standardized amount of the underlying asset. Standardized deliver dates.

Expert Solution

Future contracts are not traded by bank dealers via telephone because they are regularized contracts through organised exchanges and they have standard amount of underlying asset and they are marked to market.

All the other options are false.

Correct answer is option (B) Traded by bank dealers via a network of telephone and computerized billing system.

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