金融英语第十三章答案

Chapter13 (exercises)

I .Answer the following questions in English.

1.Carefully describe a futures contract.

A future contract is a blinding agreement between a seller and a buyer to make and to take delivery of the underlying commodity at a specified future date with agreed upon payment terms.

Futures contracts are standardized with respect to the delivery month.

2.Explain how futures contracts are valued daily,

It is possible to calculate a theoretical fair value for a futures contract.The fair value of a futures contract should approximately equal the current value of the underlying shares or index,plus an amount referred to as the “cost of carry”.The full value of the contract is not paid or received when the contract is established-instead both buyer and seller pay a small initial

margin.

3.Describe the role of the clearinghouse in futures trading.

The clearinghouse,an agency or separate corporation of a futures exchange.The clearinghouse becomes the buyer to each seller and assumes responsibility for protecting buyers and sellers from financial loss by assuring performance on each contract.

4. Explain the differences between a hedger and a speculator.

The difference between hedgers an speculators is the risk.

Hedgers are parties at risk with a commodity or an asset,but speculators trads futures with the objective of making a profit by being on the right side of a price move.

5. Give a brief description of the history of futures.

Both the histories of futures are focused on that how people

have tried to improve the effectiveness of the commercial marketplace. 6. What is key difference between forward and futures?

Forward contracts and futures comparison: the former is a standardized contract, OTC, flexible and high transaction cost, risk is big. The latter are standardized contracts, exchange as a medium, investors and unlike forward contracts as the direct trading, risk is small.

Options and futures comparison: futures trading both sides has rights and obligations. While the option buyer the right to sell only, only obligation. In addition from the gains and losses, the futures of profit and loss is uncertain, but the option buyer 's loss is the option premium.

Ⅱ. Fill in the each blank with an appropriate word or expression.

1. Futures are binding agreements made between two parties

through a regulated futures exchange. Each futures contract

specifies the quantity and quality of the item, expiration

month, the time of delivery and virtually all the details

of the transaction except price , which the two parties

negotiate based on current market conditions.

2. The clearinghouse, an agency or separate corporation of a

futures exchange, is responsible for settling

trading accounts, collecting and margin monies,regulating

delivery and reporting trade data.

3. A futures contract is an agreement to purchase or sell a

commodity for delivery in the future: ( 1 ) at a price that

is determined at initiation of the contract; (2) which

obligates each party to the contract to the contract at the

specified price; (3) which is used to assume or shift price

risk ; and(4) which may be satisfied by delivery or offset

４. The key to any hedge is that a futures position is taken opposite to the position in the cash market. That is, the nature

of cash market position determines the hedge in the futures

market.

5. Currency futures are standardized contracts that trade

like conventional commodity futures on the floor of a futures exchange.

6. These orders,from companies,individuals,and even

market-making commercial banks, are happened to the floor of

the futures exchange.

Ⅲ. Translate the following sentences into English.

1．商品生产者和经营者在生产和经营过程中，时刻面临着价格波动

的风险。

Commodity producers and operators in the production and management

process, always faces the risk of price fluctuation.

2．价格无论向哪个方向变动，都会给一部分商品生产者和经营者造

成损失。期货市场建立以后，他们可以在期货市场上按预期价格卖出

商品和买进商品，锁住成本。

No matter which direction to change the price, will give a partial commodity

producer and operator caused loss. After establishing futures market, they can

in the futures market according to the expected price of goods sold and buy

goods, lock-in cost.

3．期货市场以标准化的交易所交易的证券代替了不规范的远期合约。