Chapter 02 · Section 2.1
IMM Futures
Suppose an IMM DM futures call option is exercised.
What is the effect of exercise?
d) The call writer receives a short futures contract.
No. You are perfectly right about (d). But if somebody gets a short futures contract, somebody else must get a long futures contract.
e) The call holder receives a long futures contract.
f) d and e
a) The call holder receives dollars.
b) The call writer receives dollars.
c) The call holder receives a short futures contract.
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