The use of leverage is practiced in the futures markets due to the existence of ________.
A) banks
B) brokers
C) clearinghouses
D) margin

Question

Quizplus · Accepted Answer

The use of leverage in the futures market is made possible by the existence of margin. Margin refers to the funds deposited with a broker to cover potential losses from trading futures contracts. Traders can use this margin to amplify their trading positions and increase potential profits.

The Use of Leverage Is Practiced in the Futures Markets