Why does a futures contract have zero value

Reference no: EM131457867

Question: 1. Why does a futures contract have zero value when it is first written?

2. What is marking-to-market for a futures? Why is this marking-to-market important for reducing counterparty risk?

Reference no: EM131457867

Questions Cloud

Summarize apples supplier responsibility information : List specific changes that Apple has made to its Code of Conduct in recent years. Summarize Apple's Supplier Responsibility information.

Explain how you would set up a spread trade : Suppose that Boring Unreliable Gadget Inc. has two classes of shares with different voting rights. You find that class A and class B shares are trading at $49.

Calculate the cost of equity for block ltd : The following information relates to Block Ltd, a manufacturing company from which you are required to do a valuation.Calculate the cost of equity for Block Ltd

Describe at least three human resource factors : Describe the different organizational structures as it relates to project management (i.e., functional, project-based, matrix).

Why does a futures contract have zero value : What is marking-to-market for a futures? Why is this marking-to-market important for reducing counterparty risk?

Discuss the impact of exchange rate fluctuations on a firm : Goldman, Sachs, and Co.: Nikkei Put Warrants-1989 (Harvard Business School Case 292113-PDF-ENG). The case illustrates how investment banks can design.

Which is the second most common cause of storm related death : Which is the second most common cause of storm related death in the U.S.? Which statement best describes the change in sea level during the past 20,000 years?

Differenciate an options delivery and expiration dates : Explain the differences between European and American options. How do the names relate to the geographical continents?

Find the distance between the two planes : Find the distance between the two (parallel) planes- Find the point of intersection of the three planes Find the (shortest) distance from the point to plane

User Account

All Pages