金融英语_刘文国第二版课后练习Exercises 13

Exercises 17

Ⅰ. Answer the following in English

1.Carefully describe a futures contract.

A futures contract is a binding agreement between a seller and a

buyer to make (seller) and to take (buyer) delivery of the underlying commodity (or financial instrument) at a specified future date with agreed upon payment terms.

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'

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

The clearinghouse, an agency or separate corporation of a futures exchange, is responsible for settling trading accounts, collecting and maintaining margin monies, regulating delivery and reporting trade data. The clearinghouse becomes the buyer to each seller (and the seller to each buyer) 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.

Hedgers are interested in the products of the futures contracts.

They can be producers, like farmers, mining companies and oil drillers. Or they can be users, like bankers, paper mills and oil distributors. In general, producers sell futures contracts while users buy them. Speculators, trade futures strictly to make money.

Typically, speculators trade futures contracts, but never use the commodity itself.

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

The history of futures trading is, in a sense, two histories, both focused on how people have tried to improve the effectiveness of the commercial marketplace. The early story is a tale of how people in an agrarian society used forward contracts (agreements to buy now, but pay and deliver later) as a means of getting farm commodities efficiently from producers to consumers, at established prices and delivery terms, and how those forward contracts evolved into futures contracts. The present day story explains how the futures industry reinvented itself in the latter part of the twentieth century, essentially by redefining the meaning of “commodity,” so that it could accommodate the needs of complex financial markets in a society whose economy was no longer based primarily on agriculture.

6.What is key difference between forward and futures?

Basically, forward and futures contracts operate in a similar manner

by allowing people to buy or sell a particular type of asset at a

specific time at a specified price. However, the particular details

of these contracts are quite different.

One of the key differences is that futures contracts are traded on

the exchange and are based on standard criteria. Forward contracts,

on the other hand, are agreements made privately between two parties.

Because of this, there is more flexibility in the terms and

conditions.

Another issue surrounding these differences is that of security.

Because of the private nature of the agreement in forward contracts,

there is no guarantee that a party will not default. However, because

futures contracts have clearing houses, the agreement is guaranteed.

A clearing house is a third party who guarantees the transaction.

To understand the differences, it is necessary to clarify the exact

nature of both futures contracts and forward contracts.

Essentially, a futures contract is a contractual agreement made to

buy or sell a specific product or service at a pre-determined price

in the future. The contract specifies the quality and quantity of the

product or service and are standardized to allow trading on a futures

exchange.

A forward contract is a cash market transaction where the contract is

made but the delivery of the specific product or service is postponed.

The price is agreed upon at the time the contract is made. Often, a

farmer may use a forward contract to ensure a good price for his

produce.

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

1.Futures are contractual agreements made between two parties through a

regulated futures exchange. Each futures contract specifies the 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 maintaining 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 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 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 communicated 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。

The commodity producer and the operator is facing the price

fluctuations risk frequently in the process of producing and

operation,

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。

Regardless of actual price fluctuation path, a part of commodity

producers and the operators will lose some thing. After establishing

futures market, they may sell and buy the commodity according to the

expected price in the futures market and lock the commodity 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。

Standard contract trading in future exchange replace irregular

forward contract in future market.

4.需要特别注意的是，交割日的期货价格等于当时的现货价格。

The more attention should be on that the future price in

maturity is equal to spot price.

5.产品期货交易还可以在一定程度上减少商品价格的波动。

The product future trading may also reduce the commodity price

fluctuation to a certain extent.

6.期货市场上产品经营风险的转移功能大部分是由投机牟利者来完成的。期货市

场上的投机牟利者利用产品价格的频繁变化进行买空和卖空，从中谋利。

The majority of transfer function of operational risk in the futures

market is completed by speculators. The speculators in futures

market make use of price’s frequent change to make long and short

for profit.

Ⅳ. Translate the following passage into Chinese

1.Futures trading have a long history, both in the U. S. and around

the world. Futures trading on a formal futures exchange in the U. S.

originated with the formation of the Chicago Board of Trade (CBT) in the middle of the Nineteenth Century.

期货贸易在美国和世界其它地方都有悠久的历史，美国期货贸易的正式交易起源和形成是在19世纪中期的芝加哥贸易委员会(CBT)。

2.Grain dealers in Illinois were having trouble financing their grain

inventories. The risk of grain prices falling after harvest made

lenders reluctant to extend grain dealers credit to purchase grain for subsequent sale in Chicago.

伊利诺伊洲的粮食经销商在购买粮食陈货有经费问题时。粮食丰收后粮价下跌的风险使芝加哥使贷款人不情愿扩展粮食经销商的借款信用来储存粮食以备期后销售。

3.To reduce their risk exposure, grain dealers began selling "To

Arrive" contracts, which specified the future date (usually the

month) a specified quantity of grain would be delivered to a

particular location at a price identified in the contract.

为减少风险程度，粮食经销商开始销售“即将到期”合同，合同规定了粮食交易价格并在未来某个日期(通常指月份),将特定数量的粮食运到一个指定的地点交货。

4.Futures are contractual agreements made between two parties through

a regulated futures exchange. The parties agree to buy or sell an

asset-livestock, a foreign currency, or some other item---at a

certain time in the future at a mutually agreed upon price.

期货是一个买卖双方根据期货买卖规则签订的合同化协议,双方同意卖或买一项资产,外币,或某一其他项目---在期货合同中注明将来某个时间到期和双方同意的价格.

https://www.360docs.net/doc/eb9654841.html,modity markets have existed for centuries around the world

because producers and buyers of foodstuffs and other items have

always needed a common place to trade.

世界商品市场已有几个世纪的历史,这是因为粮食和其他项目的生产商和买家总是需要一个共同的地方进行贸易。

6.Currency futures are standardized contracts that trade like

conventional commodity futures on the floor of a futures exchange.

货币期货就像期货交易所的常规商品期货交易样的标准合约.