If your firm buys a Futures Contract, it is likely that they would be fully hedged? Please explain in your own words.

Question

If your firm buys a Futures Contract, it is likely that they would be fully hedged? Please explain in your own words.
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Solution 1

A futures contract is a financial derivative that obligates the buyer to purchase an asset, or the seller to sell an asset, at a predetermined future date and price. It is used to hedge against the risk of price fluctuations.

If a firm buys a futures contract, it means they are locking in a price Knowee AI StudyGPT is a powerful AI-powered study tool designed to help you to solve study prob

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