To protect itself, the futures clearinghouse requires
A) margin from the seller only.
B) 100% of the value from the seller.
C) margin from both the buyer and seller.
D) margin from the buyer only.

Question

Quizplus · Accepted Answer

The futures clearinghouse requires margin from both the buyer and the seller to protect itself from potential losses due to market fluctuations. This ensures that both parties have a financial stake in the transaction and reduces the risk of default by either party. The margin requirement typically varies depending on the underlying asset and other factors, but it is typically a percentage of the total value of the futures contract.

To Protect Itself, the Futures Clearinghouse Requires