Series 3 – The National Commodities Futures Test Futures Trading Mechanics & Market Structure Flashcards
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What is the minimum price fluctuation of a futures contract called?
Answer: Tick
A tick is the smallest allowable price movement for a given futures contract as defined by the exchange.
Which type of futures order instructs the broker to execute a trade at the best available price immediately?
Answer: Market order
A market order directs the broker to buy or sell at whatever price is currently available in the market.
Initial margin in a futures account is best described as:
Answer: A good-faith deposit required to open a position
Initial margin is a performance bond deposit required by the exchange to initiate a futures position.
When a futures position is marked to market and the account falls below the maintenance margin level, the trader receives a:
Answer: Margin call
A margin call requires the trader to deposit additional funds to restore the account to at least the initial margin level.
An open interest figure of 50,000 in a futures market means:
Answer: There are 50,000 outstanding long and short contracts combined
Open interest counts the total number of outstanding contracts that have not been settled or offset.
Which futures market participant primarily enters the market to profit from price movements without intending to take delivery?
Answer: Speculator
Speculators assume price risk to profit from anticipated market moves and have no commercial interest in the underlying commodity.
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Sources & references
Exam facts on this page (fees, format, dates, passing scores) are checked against these official sources; the date is our last check. Editorial policy
- finra.org — Score release, test dates, test delivery, fees, exam format, passing score · verified Oct 2026
- nfa.futures.org — Eligibility, score validity · verified Oct 2026