Black asked in 商業及金融投資 · 1 decade ago

Could anyone show me the answer (with calculation)

An investor enters a short position in July wheat futures contract for 5000 bushels at $4/bushel. Suppose the initial margin is 5%. How much money will she have in her futures account at the end of the second day if the closing price at first day was $4.1 and the price at the end of the second day was $3.95? Assume the maintenance margin is 65% of initial margin, the investor doesn’t withdraw money from her account in period 1, and all futures positions are cleared at the end of the day.

1 Answer

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  • Ricky
    Lv 7
    1 decade ago
    Favorite Answer

    Contract value = 5000 x $4 = 20,000

    INitial margin = $20,000 x 5% = $1,000

    Maintenance margin = 1,000 x 65% = $650

    Profit /loss (day 1) = 5000 x ($4-4.1) = $500

    Money left (day 1) = $1000 - $500 = $500

    ==> additional cash deposit of of $150 ( back to maintenance margin $650)

    Profit / loss (day 2) = 5000 x (4.1-3.95) = $750

    ney left (day 2) = $750+$650 = $1400 (include $1000 initial margin, $250 profit and $150 additional margin on day 1)

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