Presentation_on__Futures_group_7

Presentation_on__Futures_group_7 - made with Clearing...

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Click to edit Master subtitle style  5/30/11  PGPBFS-GROUP-7 Presentation on  Futures Presented By: Group 7  PGPBFS-GROUP-7
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 5/30/11  PGPBFS-GROUP-7 Futures: v Futures are specialized form of forward  contract. v Futures are fixed value contract v They are exchange rated v Highly Liquid than forwards v No counter party risk exist
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 5/30/11  PGPBFS-GROUP-7 Difference between Forwards  Forward  Contract Futures Contract Tailor  made Fixed value contract Traded in over the counter market Traded on exchange Less liquid Highly liquid Does not require margin money Requires margin money Settlement takes place at the end of the  period Follow daily settlement Settlement is only by delivery Settlement is either by delivery or by paying  price differentiation Counter party risk always exist No counter party risk exist, as the contract is 
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Unformatted text preview: made with Clearing Corporation. Profit or loss is booked on conclusion of the contract Here the contracts are marked to market on a daily basis . Therefore, the booking of profit and loss is made daily. 5/30/11 PGPBFS-GROUP-7 Types Of Futures Stock Index Futures Underlying asset is a stock index Difficult to manipulate Currency Rate Futures Underlying asset is Currency rate Mainly used by exporters and importers Hedge against the risk of currency rate fluctuation Interest Rate Futures Underlying asset is reference rate. Eg LIBOR,MIBOR etc. 5/30/11 PGPBFS-GROUP-7 Strategies Going Long Going Short Spreads...
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This note was uploaded on 05/30/2011 for the course ECON 101 taught by Professor Ke during the Spring '11 term at Lethbridge College.

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Presentation_on__Futures_group_7 - made with Clearing...

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