Futures trading eliminates:
A) market risk
B) counterparty risk
C) default risk
D) none of the above

Name: Futures trading eliminates: A) market risk B) counterparty risk C) default risk D) none of the above
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Futures trading eliminates counterparty risk because the trade is guaranteed by a clearinghouse instead of being dependent on the creditworthiness of the individual parties involved. However, it does not eliminate market risk or default risk.

Futures Trading Eliminates