Which of the following are potentially subject to risk-based capital requirements?

Question

Quizplus · Accepted Answer

Swaps and forwards are both over-the-counter (OTC) derivatives and are therefore subject to risk-based capital requirements. Forwards and futures are also OTC derivatives, but futures are typically traded on organized exchanges that have their own margin requirements, so they may not be subject to the same risk-based capital requirements as OTC derivatives. Purchased option positions and swaps are also OTC derivatives, but purchased options are typically less risky than swaps and are often used for hedging purposes, so they may not be subject to the same risk-based capital requirements as swaps.

Which of the Following Are Potentially Subject to Risk-Based Capital