In the absence of transactions costs,for the same maturity and currency

Name: In the absence of transactions costs,for the same maturity and currency
Brand: Quizplus
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Question

Quizplus · Accepted Answer

In the absence of transactions costs, the futures price and the forward rate should be the same as they are both used to hedge against future currency or interest rate fluctuations. However, in reality, futures prices can sometimes deviate from forward rates due to factors such as financing costs, delivery options, and market liquidity.

In the Absence of Transactions Costs,for the Same Maturity and Currency