Which of the following are contract specifications for futures contracts? I)Standard quantity II)Standard quality III)Pre-agreed price IV)Specified date Answer I and III I, II, and III I, II, and IV I, II, III, and IV
I was totally wrong on this one All but price is established by the exchange. The underlying, quantity, quality, expiration, even delivery method and location. The price is left out for sellers and buyers to match. I was right the first time, but not in the explanation. The future exchange predetermines all but price.
I,II,III and IV edit: to clarify I- standardized contract II- clearinghouse guarantee III- ‘exercise price’ or any other value for the underlying IV- expiry/settlement date Are all attributes of a futures contract.
Pre - agreed? What do you mean by that? If I go long the future, i fix the price… so the price is pre-agreed with the exchange… Why not D?
yeah you have to have all. D is what I pick.
D?
I, II, IV, The price is not specified in the future contract, as it is agreed at the time of the trade.
I bet is C.
The first future contract was made on orange juice prices 
Why is ‘III)Pre-agreed price’ not a component of a futures contract? For example, call option with exercise price $25.
supersharpshooter Wrote: ------------------------------------------------------- > Why is ‘III)Pre-agreed price’ not a component of a > futures contract? > > For example, call option with exercise price $25. we are talking about future contracts
D or C, strange?
I clearly need to read SS17 again :-f
cfaisok Wrote: ------------------------------------------------------- > D or C, strange? C!
strangedays Wrote: ------------------------------------------------------- > The first future contract was made on orange juice > prices No way - CBOT started trading futures contracts in 1848. FCOJ wasn’t traded until the 1960’s.
So what’S wrong with my argumenation?
The answer must be c, but it’s really something like just I. There are all sorts of quality options in futures contract as well as delivery date options.
cfaisok, Joey, I said the answe is C. You guys dont trust me…dont you!? By the way, I read about the future on orange juice on John Hull book a while ago I think…need to double check and let you know (anyway they were the first to be traded on something)
