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15.8. Bob takes a long position in one contract of S&P 500 futures. Each contract is...
15.6. [Introductory Derivatives Sample Question 30] Determine which of the following is NOT a distinguishing characteristic...
15.6. [Introductory Derivatives Sample Question 30] Determine which of the following is NOT a distinguishing characteristic of futures contracts, relative to forward contracts. (A) Contracts are settled daily, and marked-to-market. (B) Contracts are more liquid, as one can offset an obligation by taking the opposite position. © Contracts are more customized to suit the buyer's needs. (D) Contracts are structured to minimize the effects of credit risk. (E) Contracts have price limits, beyond which trading may be temporarily halted. 15.7....
2. A trader takes a long position and a hedge fund takes a short position on...
2. A trader takes a long position and a hedge fund takes a short position on ten S&P 500 futures contracts at 3300. A single S&P 500 futures contract invoice price equals ($50) x (Index Price). The initial margin is $12,500 and the maintenance margin is $9,500 per contract. Ten trading days later, the futures price of the index drops to 3150. a) What is the change in margin account balance 1) for the trader, and 2) for the hedge...
3a. Fill in the table below for a long position in S&P 500 futures contract with...
3a. Fill in the table below for a long position in S&P 500 futures contract with 250 multiplier. Initial Margin is S 35000 10 points S&P 500 Future Price 2555 Investment Value Gain (+) Loss (-) Balance as Margin Time 2 2535 2575
Micro E-mini S&P 500 Futures contract
You have \(\$ 100,000\) to invest today. You are bullish about the stock market and you think that the S\&P 500 index is going up. You want to leverage your investment by taking a long position in S\&P 500 index futures.Micro E-mini S\&P 500 Futures contractThere is a new futures contract on the S\&P 500 index with a lower contract multiplier-only 5 times the index. You are using this contract to implement your strategy. You chose the contract expiring on...
Problem 2.2. A company has a short position in futures contract to sell 5,000 bushels of...
Problem 2.2. A company has a short position in futures contract to sell 5,000 bushels of wheat. The company had entered into the contract when the futures price was 225 cents per bushel. The initial margin is $3,000 and the maintenance margin is $2,000. The current futures price is 250 cents per bushel and the margin account balance is $3,250. (a) Determine the net margin deposits to or margin withdrawals from the margin account so far. (6) What price change...
Q1 (Futures Margin call) You took a long position in 10 Eurodllar futures contracts (June 2014...
Q1 (Futures Margin call) You took a long position in 10 Eurodllar futures contracts (June 2014 delivery) on 1/13/2012 at the price indicated below. You met all margin calls, and did not withdraw any excess margin. All ED futures have a 90-day maturity and a notional principal of $1 million regardless of the delivery month. When the ED futures price increases by 1 basis point (98.35 to 98.36, for example), one long ED futures position gains $25, and one short...
On January 1, you sold one March maturity S&P 500 Index futures contract at a futures...
On January 1, you sold one March maturity S&P 500 Index futures contract at a futures price of 1,000. If the futures price is 1,100 on February 1, what is your profit or loss? The contract multiplier is $250. (Input the amount as positive value.) (Click to select)LossProfit of $
On 1 January you sold one March maturity S&P/ASX 200 index futures contract at a futures...
On 1 January you sold one March maturity S&P/ASX 200 index futures contract at a futures price of 700. If the futures price is 800 on 1 February, what is your profit? The contract multiplier is $25. In other words, the contract calls for delivery of $25 times the value of index. 1 index point move translates into a $25 change in the value of the contract. a. $100 b. -$100 c. $700 d. $2,500 e. -$2,500 Which one of...
Can someone help me with this problem? 13. John has entered into 25 long futures contracts...
Can
someone help me with this problem?
13. John has entered into 25 long futures contracts on a certain stock index. Each contract is for 80 shares of the index. The initial margin is 20%, and the maintenance margin is 90% of the initial margin. John's margin account earns interest at a continuously compounded rate of 9%. The account is marked-to-market monthly. At the time when Jordan enters the contracts, the price of the stock is S. At the end...
Louis deposits $80,000 of margin and takes a short position in 80 corn futures contracts, covering...
Louis deposits $80,000 of margin and takes a short position in 80 corn futures contracts, covering 5000 bushels each, on Monday. Louis' trade price and the closing futures price on Monday are both $3.9050 per bushel. The initial and maintenance margins are $1000 and $800, respectively, per contract. The daily interest rate is 1.1 basis points per day on Monday and Tuesday and 1.2 bp per day on Wednesday. There are no transaction costs. On Tuesday, Wednesday and Thursday, the...
15.6. [Introductory Derivatives Sample Question 30] Determine which of the following is NOT a distinguishing characteristic of futures contracts, relative to forward contracts. (A) Contracts are settled daily, and marked-to-market. (B) Contracts are more liquid, as one can offset an obligation by taking the opposite position. © Contracts are more customized to suit the buyer's needs. (D) Contracts are structured to minimize the effects of credit risk. (E) Contracts have price limits, beyond which trading may be temporarily halted. 15.7....
2. A trader takes a long position and a hedge fund takes a short position on ten S&P 500 futures contracts at 3300. A single S&P 500 futures contract invoice price equals ($50) x (Index Price). The initial margin is $12,500 and the maintenance margin is $9,500 per contract. Ten trading days later, the futures price of the index drops to 3150. a) What is the change in margin account balance 1) for the trader, and 2) for the hedge...
3a. Fill in the table below for a long position in S&P 500 futures contract with 250 multiplier. Initial Margin is S 35000 10 points S&P 500 Future Price 2555 Investment Value Gain (+) Loss (-) Balance as Margin Time 2 2535 2575
Problem 2.2. A company has a short position in futures contract to sell 5,000 bushels of wheat. The company had entered into the contract when the futures price was 225 cents per bushel. The initial margin is $3,000 and the maintenance margin is $2,000. The current futures price is 250 cents per bushel and the margin account balance is $3,250. (a) Determine the net margin deposits to or margin withdrawals from the margin account so far. (6) What price change...
Can
someone help me with this problem?
13. John has entered into 25 long futures contracts on a certain stock index. Each contract is for 80 shares of the index. The initial margin is 20%, and the maintenance margin is 90% of the initial margin. John's margin account earns interest at a continuously compounded rate of 9%. The account is marked-to-market monthly. At the time when Jordan enters the contracts, the price of the stock is S. At the end...
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