If you are short a futures contract, why do you not have to borrow the futures contract
Question:
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 50% (14 reviews)
The mechanism of shorting or shortselling works differently ...View the full answer
Answered By
Parvesh Kumar
I am an experienced Mathematics and Statistics tutor with 10 years of experience teaching students and working professionals. I love teaching students who are passionate to learn subjects or wants to understand any mathematics and statistics concept at graduation or master’s level. I have worked with thousands of students in my teaching career. I have helped students deal with difficult topics and subjects like Calculus, Algebra, Discrete Mathematics, Complex analysis, Graph theory, Hypothesis testing, Probability, Statistical Inference and more. After learning from me, students have found Mathematics and Statistics not dull but a fun subject. I can handle almost all curriculum of mathematics. I did B.Sc (mathematics), M.Sc (mathematics), M.Tech (IT) and am also Gate (CS) qualified. I have worked in various college and school and also provided online tutoring to American and Canadian students. I look forward to discussing with you and make learning a meaningful and purposeful
5.00+
4+ Reviews
10+ Question Solved
Related Book For
An Introduction to Derivative Securities Financial Markets and Risk Management
ISBN: 978-0393913071
1st edition
Authors: Robert A. Jarrow, Arkadev Chatterjee
Question Posted:
Students also viewed these Banking questions
-
What is the difference between a forward contract and a futures contract? Why do you think that futures contracts are much more common? Are there any circumstances under which you might prefer to use...
-
Consider a stock that will pay a dividend of D dollars in one year, which is when a futures contract matures. Consider the following strategy: Buy the stock, short a futures contract on the stock,...
-
1. Which of the following statements is false? a. A spot price is a price today for immediate delivery. b. If a Canadian firm has to pay U.S. dollars in the future, it worries about the potential...
-
Chiz enterprise reports its gross sales/receipts during the quarter as follows: Sale of computers Gross receipts - computer repairs Sales returns and allowances Sales discounts for early payments...
-
Explain the processes of deduction and induction, giving an example of each.
-
P Forte commences business on 1 January buying and selling pianos. He sells two standard types, upright and grand, and his transactions for the year are given in the table below. You observe that the...
-
With reference to Exercise 10.9, how would the required sample size be affected if it is known that the proportion to be estimated is at least 0.75 ? Data From Exercise 10.9 10.9 What is the size of...
-
Prepare the 2021 statement of cash flows for Smolira Golf Corp. Some recent financial statements for Smolira Golf Corp. follow. Use this information to work this problem. SMOLIRA GOLF CORP. 2020 and...
-
As with law enforcement and court personnel, corrections, probation, and parole officers are held to a high ethical standard. Corrections, probation, and paroleagencies must be diligent in addressing...
-
You and 11 coworkers just won $12 million ($1,000,000.00 each) from the state lottery. Assuming you each receive your share over 16 years and that the state lottery earns a 4 percent return on its...
-
When holding a futures contract long, if you do not want to take delivery of the underlying asset, what transaction must you perform? Explain.
-
Is the futures price equal to the value of the futures contract? If not, then what is the value of a forward contract when it is written? Explain.
-
Suppose the sample in Exercise 7.64 has produced p = .83 and we wish to test H0: p = .9 against the alternative Ha: p < .9. a. Calculate the value of the z-statistic for this test. b. Note that the...
-
In primitive societies, the entitlements to use land were frequently possessory rights rather than ownership rights. Those on the land could use it as they wished, but they could not transfer it to...
-
In a well-known legal case, Miller v. Schoene (287 U.S. 272), a classic conflict of property rights was featured. Red cedar trees, used only for ornamental purposes, carried a disease that could...
-
This chapter contains two views of the future. Since the validity of these views cannot be completely tested until the time period covered by the forecast has passed (so that predictions can be...
-
Suppose you come from a part of the world that is blessed with abundant water. Demand never comes close to the available amount. Should you be careful about the amount you use or should you simply...
-
Should U.S. national forests become privatized (sold to private owners)? Why or why not?
-
In Exercises 9093, determine whether each statement is true or false. If the statement is false, make the necessary change(s) to produce a true statement. The graph of (x - 3) 2 + (y + 5) 2 = 36 is a...
-
What are the two components of a company's income tax provision? What does each component represent about a company's income tax provision?
-
Why is regulatory forbearance a dangerous strategy for a deposit insurance agency?
-
The FIRREA legislation of 1989 is the most comprehensive banking legislation since the 1930s. Describe its major features.
-
What steps were taken in the FDICIA of 1991 to improve the functioning of federal deposit insurance?
-
Why are gains/losses added back to (or deducted from) the cash from operations section of a cash flow statement?
-
Combination A, B, C, and F is the fifth most valuable with an NPV of $169,000. how did you came up with it?
-
Using a suitable example explain how you would check that equipment is ready for shut down to commence?
Study smarter with the SolutionInn App