The major difference between FRAs and futures is that FRAs are:
A) Exchange-traded
B) Margined
C) Standardized
D) Dealtoverthe counter

Question

Quizplus · Accepted Answer

FRAs are traded over the counter, meaning the terms of the contract are negotiable between the two parties involved. Futures, on the other hand, are exchange-traded and standardized, meaning there is a set contract size, expiration date, and tick size. Futures are also margined, meaning traders must deposit initial margin to open a position.

The Major Difference Between FRAs and Futures Is That FRAs