Exercise
Answer true or false.
- 1. _____ Each party to a futures transaction must have an account with a clearing firm or with another futures commission merchant that has an account with a clearing firm.
- 2. _____ The clearinghouse serves as the counterparty to each side of every futures transaction.
- 3. _____ The initial margin requirement for a futures trading account can never exceed that required by an exchange.
- 4. _____ In a futures contract, a new settlement price is determined at the close of each business day, and the account is adjusted accordingly.
- 5. _____ If an investor’s account falls below the minimum maintenance requirement, it is that investor’s responsibility to meet the initial margin requirement by the following day.
- 6. _____ When a futures contract goes to delivery, the holder of the long position receives the commodity.
- 7. _____ Most futures contracts do not end in the delivery of the product.
- 8. _____ A buyer who holds a transferrable notice must always accept delivery of commodities.
- 9. _____ A basis grad
