Unlike options,the purchase of a futures contract is a binding obligation to purchase at a fixed price at contract maturity.

Question

Quizplus · Accepted Answer

This statement is true. When an investor purchases a futures contract, they are obligated to buy the underlying asset at a fixed price upon contract maturity. They cannot choose to not exercise their right to purchase the asset. Options, on the other hand, give investors the right but not the obligation to buy or sell an underlying asset at a predetermined price.

Unlike Options,the Purchase of a Futures Contract Is a Binding