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    Question

    Which of the following is not an advantage of

    Futures? 
    A Price discovery Correct Answer Incorrect Answer
    B Elimination of counter party risk Correct Answer Incorrect Answer
    C Customised products meeting the requirements of the customers Correct Answer Incorrect Answer
    D Transparent trading Correct Answer Incorrect Answer
    E Improved liquidity Correct Answer Incorrect Answer

    Solution

    Futures have rather standardized products, which often leads to improving liquidity in futures. This works against this product when a client needs to hedge a specific amount to a date for which there is no standard contract.

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