Which of the following statements is true?
A)In a spot contract the buyer and seller enter into a contract at time 0, the contract is marked to market, the seller agrees on a price at time 0 and the bonds is delivered by the seller to the buyer 'at that time'.
B)In a spot contract the buyer and seller agree on a price at time 0 and the bonds is delivered by the seller at a future point in time, for example, after three months.
C)In a spot contract the buyer and on a daily basis, and the buyer pays the spot price quoted at expiry.
D)None of the listed options are correct.

Question

Quizplus · Accepted Answer

A spot contract is an agreement between parties to buy and sell an asset at its current market price with immediate delivery. In a spot contract, the buyer and seller enter into a contract at time 0, the contract is marked to market, the seller agrees on a price at time 0 and the bonds are delivered by the seller to the buyer 'at that time'.

Which of the Following Statements Is True