ecletcicbeauty2545 ecletcicbeauty2545
  • 17-02-2020
  • Business
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Is the futures price of a stock index greater than or less than the expected future value of the index? Explain your answer.

Respuesta :

ammad472
ammad472 ammad472
  • 21-02-2020

Answer:

It can be greater as well as less.

Explanation:

1st of all we should know what is Future Price and what is Stock Index.

The futures price can be more or less that the predicted fee.

When futures costs are lower than predicted price spot fees, the situation is known as normal backwardation.

When futures prices are higher than anticipated spot charges, it is called normal contango

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