Futures Contracts Resources

Futures Contracts

Resources

• Discussion Participation Scoring Guide.

Four factors affect the value of a futures contract on a stock index—three of which are:

• The current price of the stock index.
• The time remaining until the contract maturity date.
• The dividends of the stock index.

Identify the fourth factor, and explain how and why changes in this factor affect the value of the futures contract.

Note: This is a CFA Exam Level 2 question.

Response Guidelines

Review the posts of at least two other learners and answer the following questions, providing explanations as needed:

• How does the interest rate environment impact the futures market?
• Is the futures market isolated from essential time value of money elements?
• Would the same elements that affect futures markets impact derivatives markets also?