Sally Ferguson, CFA, is a hedge fund manager. Ferguson utilizes both futures and forward contracts in the fund she manages. Ferguson makes the following statements about futures and forward contracts:
Statement 1: A futures contract is an exchange traded instrument with standardized features.
Statement 2: Forward contracts are marked to market on a daily basis to reduce credit risk to both counterparties.
Are Ferguson's statements correct?
(A) Only one of these statements is correct.
(B) Both statements are correct.
(C) Neither statement is correct.
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