5 Questions
What is the primary purpose of a derivative contract?
To define the rights and obligations of each party
What is the term for the duration of time until a derivative contract reaches its maturity?
Maturity-length
What is the position held by the seller in a derivative contract?
Short position
What is the term for the amount of the underlying asset in a derivative contract?
Notional amount
What are the two main types of derivatives?
Forward commitment and Contingent claim
Test your knowledge of derivatives contracts, including the role of buyers and sellers, contract size, and maturity length. Learn about the legal agreements that define the rights and obligations of each party involved.
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