What are the main differences between futures and forwards?
When dealing with derivatives, we classify them into contingent claims and firm commitments. Futures and forwards are two of most well-known derivatives. Which of the following sentences is correct in relation to the differential characteristics between futures and options? a) Futures are an exchange-traded firm commitment derivative, while forwards are OTC (Over The Counter) contingent
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What is the difference between a firm commitment and a contingent claim?
When dealing with derivatives, we classify them into contingent claims and firm commitments. Which of the following sentences better represent the difference between them? a) Firm commitments can be used to take either a long or a short position. Futures and options are examples of firm commitments. b) In a firm commitment, both counterparties face
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