Which of the following statements is true regarding the dist
Which of the following statements is true regarding the distinction between futures contracts and forward contracts?
a. Futures contracts are cash-settled at maturity, whereas forward contracts results in delivery.
b. All else equal, forward prices are higher than future prices.
c. Futures contracts are exchange-traded, whereas forward contracts are OTC-traded.
d. Forward contracts are created from baskets of futures contracts.
Solution
Correct option is option C.
c. futures contract are exchanged traded, whereas forward contracts are OTC traded.
