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Forwards are subject to counterparty risk because they are private contracts between two parties, and there is a risk that one party may default on their obligations. In contrast, futures contracts (option B) are typically traded on organized exchanges with a clearinghouse acting as the counterparty to both parties, reducing counterparty risk. Options (option C) also involve counterparty risk, but it is generally lower compared to forwards because options are standardized and often traded on organized exchanges with similar clearing mechanisms as futures contracts.
Which planet is known as the Red Planet?
A stone is dropped from a height of 45 m. How long will it take to reach the ground? (Take g = 9.8 m/s² )
The main thinking part of the brain is:
Limonitic ore is the ore of which metal?
Which of the following is used as red pigment in making batteries, lead glass and rust proof primer paints?
Two waves, each of amplitude 1.5 mm and frequency 10 Hz, are travelling in opposite direction with a speed of 20 mm/s. The distance in mm between adjace...
Which of the following acids is present in an ant’s string?
Which of the following is a physical change?
Which among the following is produced using ‘Haber Process’?
Zero group was introduced by