Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Futures contract
- This topic has 3 replies, 2 voices, and was last updated 3 years ago by John Moffat.
- AuthorPosts
- November 27, 2021 at 2:29 am #641732
Sir i have seen in most questions except for Boullain they are not considering futures contract size for calculation purpose other questions just explain they are under or over hedged but never take into account those in calculation so which approach should be followed in exam Boullain company approach or others?
November 27, 2021 at 8:35 am #641764Futures can only be traded in fixed fixed contracts and as a result there is almost always an over or under hedge.
You should always mention the over or under hedge and that they could use forward contracts on this amount so as to hedge the risk. If you have time (and if the question gives forward rates) then it would be as well to calculate this as well, but it is a minor point. It is showing that you know how futures are used that is important.
Have you watched my free lectures on all of this?
November 27, 2021 at 8:41 am #641768Yes sir have seen all of your AFM videos and they are excellent thanks a lot for the clarification
November 27, 2021 at 8:44 am #641770You are welcome 🙂
- AuthorPosts
- The topic ‘Futures contract’ is closed to new replies.