The sum of the daily settlements on a currency futures contract equals the net gain or loss at the expiration of a comparable forward contract.

Question

Quizplus · Accepted Answer

This statement is true. The daily settlements on a currency futures contract reflect the gains or losses on the contract as the market price changes. At expiration, the final settlement amount is determined and should be equal to the net gain or loss that would have been realized on a comparable forward contract. This is because both futures and forward contracts are used for hedging and speculation, and their prices should reflect the same underlying market conditions.

The Sum of the Daily Settlements on a Currency Futures