Page 140 - DCOM507_STOCK_MARKET_OPERATIONS

Unit 6: Trading Strategies

6.10 Review questions Notes

1. Define Futures.
2. Define Forward Contracts.

3. Discuss the relationship between ‘spot rate’ and ‘forward rate.’
4. Write short note on “forward as hedge instrument.”
5. Distinguish between ‘forward contract’ and ‘futures contract.’
6. Enumerate the basic difference between a forward contract and a futures contract.
7. Write short note on ‘futures and options.’

8. Who are the major players in the futures market?

Answers: Self Assessment

1. Sensitivity 2. Allocation
3. Avoidance 4. Retention
5. Transfer 6. True

7. True 8. True
9. True 10. False
11. Hedgers 12. Speculators
13. True 14. True

15. False

6.11 Further Readings

Books Lister, RJ. (ed.): Studies in Optimal Financing, London, Macmillan, 1973.
Longstreth, Bevis: Modern Investment Management and the Prudent Man Ruk,
Oxford University Press, 1986.

Lorie, James H. and Marry T. Hamilton: The Stock Market: Theories and Evidence,
Homewood III, Richard D. Envin, Inc, 1973.
Portfolio and Investment Section Theory and Practice, Prentice Hall, 1984.

Online links stocksthatmove.com/education/content/strategies.pd
finance.martinsewell.com/trading-systems/Sand02.pdf
ftp://server.71.lt/PDF/forex%20trading%20system%20-% 20encyclopedia%
20of%20trading%20strategies.pdf
http://www.cmegroup.com/education/25_proven_strategies/CME-
113_21brochure_SIDE_SR.pdf

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