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Based on your understanding of forward and futures contracts, identify the diffe

ID: 2768653 • Letter: B

Question

Based on your understanding of forward and futures contracts, identify the differences between the two: Which of the following are used to hedge against price changes for input materials? Financial futures Commodity futures Jacek feels strongly that the 20-year U.S. Treasury bond yield is too low. Which of the following derivative positions would let him earn a profit if he turns out to be right? A long position in interest rate futures A short position in interest rate futures A short position in structured notes A long position in structured notes

Explanation / Answer

1a)Forward

b)Future

c)-

2)commodity future ,as material is a commodity

3) correct option is "Short position in interest rate futures

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