Elena
Sat May 18 2024
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6 answers
1460
Do future contracts decay?
Do future contracts decay?" I ask with a note of curiosity in my voice. It's a question that has been lingering in my mind for quite some time now, especially given the volatile nature of the cryptocurrency market. Futures contracts, after all, are agreements to buy or sell an asset at a specific price on a future date. But do they undergo a process of decay, gradually losing their value or significance over time? Or are they more resilient, maintaining their integrity even in the face of market fluctuations? I'm eager to understand how these contracts behave in the long run, and how investors can factor in the potential for decay, if any, into their trading strategies.
Giulia
Fri May 17 2024
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7 answers
1731
What are the disadvantages of future contracts?
Could you elaborate on the downsides of futures contracts, please? I'm particularly interested in understanding the risks associated with them. For instance, how volatile are they and how might that affect investors? Additionally, what are the potential liquidity issues one might encounter when dealing with futures contracts? Also, could you discuss the margin requirements and how they might constrain traders? Lastly, are there any regulatory concerns or complexities that investors should be aware of? Thank you for addressing these points in detail.
