One benefit of a swap compared to futures and options is that they
A)promote liquidity.
B)reduce the risk for both the buyer and seller.
C)can be better tailored to meet the needs of market participants.
D)can involve financial instruments and not just commodities.

Question

Quizplus · Accepted Answer

Swaps can be customized to meet the specific needs of the market participants, whereas futures and options are standardized contracts. This makes swaps preferable for certain situations where a more tailored contract is necessary.

One Benefit of a Swap Compared to Futures and Options