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Which of the Following Statements Is INCORRECT About the Settlement

Question 14

Multiple Choice

Which of the following statements is INCORRECT about the settlement price in the futures markets?


A) It's always the last trading price of the day.
B) It's computed for all futures contracts-both active and inactive.
C) For actively traded contracts with little price fluctuations,the exchange's settlement committee picks a settlement price from this closing range,often the last traded price.
D) The settlement price is used for the futures position to be marked-to-market.
E) For inactive contracts,the settlement committee considers the spreads relative to other futures prices and other relevant information to determine a settlement price.

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