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1 FINANCE MCQS

According to a futures contract, the long position means the __________.

  • Purchase of forward contracts
  • Purchase of a futures contract
  • Sale of a futures contract
  • Sale of forward contracts
Correct Answer: B. Purchase of a futures contract

Detailed Explanation

In futures trading, taking a long position means agreeing to buy the underlying asset in the future at a set price. The buyer expects the price of the asset to rise so they can benefit from the increase in value. In contrast, a short position in a futures contract refers to selling, with the expectation that the price will fall.

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