If a financial institution makes an offsetting sale and purchase of the same futures contract,it has no obligation either to deliver or take delivery of the contract.

Question

Quizplus · Accepted Answer

When a financial institution makes an offsetting sale and purchase of the same futures contract, the transaction effectively cancels out the original obligation to deliver or take delivery of the contract. Therefore, the institution no longer has any obligation related to that particular futures contract.

If a Financial Institution Makes an Offsetting Sale and Purchase