Derivative Securities
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Questions and Answers

Which type of derivative security is used to alter the cash flow profile of uncertain payments or receipts?

  • Futures
  • Options
  • Swaps (correct)
  • None of the above

What is the underlying asset in a futures contract on AT&T stocks?

  • AT&T stocks (correct)
  • Chicago Mercantile Exchange
  • Derivative securities
  • None of the above

What are the three main types of derivative securities?

  • Forward, futures, and options
  • Futures, options, and swaps (correct)
  • Options, swaps, and forwards
  • None of the above

What is the purpose of call and put options?

<p>To provide insurance (A)</p> Signup and view all the answers

What is short-selling?

<p>Selling securities without owning them (B)</p> Signup and view all the answers
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