Tarkenton is incorrect because basis risk is not negligible for foreign currency futures contracts. If interest rate differentials in the home and foreign country change, the difference between the spot rate and futures rate (i.e. the basis) will change. The only way for basis risk to be eliminated is if the interest rate differential is constant or if the investor matches the maturity of the investment horizon with the maturity of the futures contract. In the latter case, the futures price will converge to the spot price at maturity.

Covered interest rate parity states that the difference between the spot rate and the forward or futures price is due to the interest rate differential between the two countries