Question

Suppose you purchase a July 2011 soybean oil futures contract on March 29, 2011, at the last price of the day. Use Table 23.1

  

What will your profit or loss be if soybean oil prices turn out to be $0.4652 per pound at expiration

Suppose you sell eight May 2011 silver futures contracts on March 29, 2011, at the last price of the day. Use Table 23.1

  

What will your profit or loss be if silver prices turn out to be $37.14 per ounce at expiration? (Input the amount as a positive values.)

   

(Click to select)LossProfit

$

  

What will your profit or loss be if silver prices are $36.66 per ounce at expiration? (Input the amount as a positive value.)

  

(Click to select)LossProfit

$

Suppose today is March 29, 2011, and your firm produces breakfast cereal and needs 110,000 bushels of corn in December 2011 for an upcoming promotion. You would like to lock in your costs today because you are concerned that corn prices might rise between now and December. Use Table 23.1

  

a.	What total cost would you effectively be locking in based on the closing price of the day? (Round your answer to 2 decimal places. (e.g., 32.16))

  

Total cost

$

  

b.	Suppose corn prices are $5.85 per pound in December. What is the profit or loss on your futures position? (Input the amount as positive value. Round your answer to 2 decimal places. (e.g., 32.16))

  

(Click to select)ProfitLoss

$

Open Cha -0.30 -035 MAY -380 BE Dec Aly * -10.1 18:20 4, 77,361 351,089 159,837 190237 142.137 64507 194911 056 0166 0161 15.310 98792 0184 0160 19 345 102113 A May 93 - 195 - 185 -183 - 154 10.067 257 111 70.772 95.098 71.946 63.285 Futures Contracts Metal & Petroleum Futures Contract On High Nile low Settle Copper High (GMX) 25.000 lbs: ontsporib. March 232.85 435.50 430 50 433.75 May 35.10 437,00 4 25 434.65 Gold (CMXO-100 troy oz: Sperry March April 142100 1421.50 1411.00 1417820 June 1422 50 1424.70 1412 10 1417.50 Aug 1404.00 1425.80 141450 1419.00 Dec 1474.60 1420.40 1416 80 1422 10 Dec'12 143740144 1437 40 1440.80 Platinum (NYM)-Stroy og Spertrooz July 1747.20 1756.00 1739.00 1744.10 Silver (CMO 5.000 trorents per troyer March 3665.0 37160 3 661.0 3697.7 May 37170 3725.0 36530 3698.7 Crude Oil, Light Sweet (NYM)-1.000 bis 5 per bal May 1039 105.00 102.70 104.79 June 104.50 105.50 10372 10532 104.96 105.95 1 0374 105.79 105.61 105.64 10454 10650 Dec 12 102.99 103.70 10205 103.56 Dec 13 100.71 101 25 100 38 10164 Heating Oil No. 2 (NYM)-2000 gas pergal. April 3.0275 3.0521 3.003630915 May 30390 3.0688 30183 3.0573 Gasoline NY RROR (NYM-22.000 pergal April 3.0280 3.0548 3.010730458 May 30292 3.0539 30071 30436 Natural Gas CYM10.000 MMB. See MM 43334359 443 4453 4.255 4263 4496 4527 2170 2115 4590 4.601 4.403 4411 4644 4.689 Jan'12 5.160 5183 5.012 .010 Agriculture Futures Corn (CBT-5.000bucents per bu May 671.00 677.00 661.25 Dec 596.00 604.25 592.75 Ethanol(CBT) 2,101 alpergal. April 2AB02416 2 462 2492 July 2465 2469 2445 2460 Oats (CRT-5.000bucenter May 309.50 351.00 3 44.35 351.00 July 358.00 35.00 353.75 359.50 Seybeans (CRT) 50 cents per be 1345.5 1369.00 1341,00 1361.50 1340.00 1399.75 1332.00 1354.85 Seybean Meal (CBT-100 tons: Sperton 3510 360,50 3 52 20 358.60 July 358.30 364.90 354.90 363.00 Soybean Oll(CBT-60,000 lbscents per Ib. May 56.39 $7.05 56.11 57 02 57.09 57.50 58.70 57,61 Rough Rice (GBD 2000 cents per cwt. May 1396 00 1395 00 1361.50 1395.50 July 1416.00 1425.00 1391.50 1416.50 Wheat (ORT-5.000 bucots berbu May 721.75 72.00 721.25 737,25 July 7600 777,00 757,00 772.75 Wheat (KO 5.000 costs perbe. May 347.50 189.00 045.00 67.00 July 85875 879.50 85.5 877.50 Wheat (MDLS-5.00 cents per bu May 877 50 694.00 672.50 888.25 July 88300 902.75 81.50 998 50 Cattle-Feeder (CME 000 scans perb. March 132.250 133 350 A 132.250 132.700 Aug 133.475 140.000 138,150 139.325 Cattle-Ulve (CME 40000 b cans perib April 117850 120 000 A 117.000 118.375 June 117.075 119.425 1 16.875 117.00 Hoesla (CMB) 41.00 Incontri April 92 600 01 000 215.00 93.500 June 103275 104 150 103.200 103.475 Pork Belles (CME-40,000 ibsents per Lumber(CHE-110.000 bd. ft. Sper 1.000 d.. 31.50 313.90 3 95 50 305.60 July 330.20 331.90 $23.50 2.70 MIR (CME-200.00 .cents perib March 19.43 1942 1941 19.46 April 16.95 17.10 16.54 16.76 Coca CE-US)-10 metrictons, Spertan. Contact Open Open High Low Setle Oy Interest Coffee KE-US)-37,500 lbs,cents perib May 2015 264.00 57.80 261.45 20.30 -2.50 July 4.5 26.5 268.5 63.028 20 93,028 Sugar-World E-US)-112.000 bs cents perib My 22:15 2268 24.49 2 63227.02 -03 209.426 2470 23-03 182,949 Sugar Demesti KE-US-112.000 inscents perib. 40,154015 4 0.15 40.07 32 40.00 40.00 40.00 40. 35 Cotton ce-US-50.000 lbs. cents perit May 19653 201.00 194.10 194.9 -2.61 71810 124.00 125.45 123.3 124.97 9 55.140 Orange Juice (ICE-US)-15.000 lbscents per 162.60 1260 1 60.40 181.65 - 159.70 150 30 17,313 157.75 159.05 -55 5.299 Interest Rate Futures Treasury Bonds (CET)-5100.000. pts 32nds of 100% June 120-190 120-200 110-120 119-280 -210 S 24 Sept 119-020 119-060 Treasury Notes (CBT)-$100,000 ps 32nds of 100% June 119-050 119-100 1 18-215 118-245 -10.9 1.365.500 Sept 117-070 117-235 112060-17-090 -10. 0 4 1 5Yr. Treasury Notes (CBT)-5100.000, bis 32nds of 100% March 117-210 117-247 117.142 117-160 42.5536 June 116-275 116-302 116-170 116-197 -47-1,258,597 2 Yr. Treasury Notes (CBT) $200,000, pts 321 of 100% March 109-137 109-137 109-115 109-112 -5 5,653 June 109-020 109-035 108-310 108-315 -15 889.907 30 Day Federal Funds (CET-$5.000.000 100-talyang March 99.883 99863 9984099.860 April 99.870 99.875 99.870 99.870 0 05 77692 1 Month Libor (OD-3.000.000 atso 100% April 99,7900 99.7525 99.7500 98.75250050 7409 May 99.7490 99.7425 99.7400 99.7425 2050 3751 Eurodollar (CME) $1,000,000;sts of 100% April 996875 90 950 99.6775 99.6825 0025 61,069 Sept 99 SOXO 99 5100 99.4000 99.4950 1.293.040 Dec 99,3450 99.3650 9. 2200 99.100 0050 387 328 Marcly 12 99.1050 99.1250 99.0550 99.0650 -0250 1,344,153 Currency Futures Japanese Yen (CME V12.500.000 person June 1.2215 1 2270 271281.2135 -0116 107.633 Sept 1.2256 1.2281 1.2143 1.2148 -0116 6 52 1.0232 1.0252 1.0202 1.0237 0008 112876 Sept 1.0198 1.0223 1.0180. 1.0212 0008 2.262 British Pound (CME)- 82.900:5per 15073 5027 1 5027 1.5975 -0011 106.622 Sept 15910 1.5998 150M 15950000 1 18 Swiss Franc (CME)-CHF 125.000 50 CHF 20911 1.0943 1 .0845 10854 - 0059 56.255 10874 1.0953 1.0858 10863-0040 58 Australian Dollar (CHE) AUD 100,000 per AUD June 10449 10200 1011 1011 0017 134413 Sept 1.0039 1.0084 9 991 - 10072 0017 Mexican Peso (CME) MIN 500.000:S per 10MXN April June 82900 8313 8 2825 83075 00025 130,217 Euro (CME-C125,00 per June 1.4065 14130 1.4026 1.4058 -0010 216456 14020 14093 1190114014-0011 1457 Index Futures DJ Industrial Average (CBT) $20 x indes June 12117 12235 A 12113 12225 111 8,015 Mini DJ Industrial Average (CT)-55xindes June 12221 12240 12220 12225 1 11 106,886 S&P 500 Index (CME)-$250x index June 1703.00 131700 1200,50 1316.50 1430 209.545 Sept 1305.00 1312 10 1298,00 1311.40 14.30 4,013 Mini S&P500(CME-550 index June 1302 75 131775 1200.25 1316.50 14.25 2.531428 550,505 339,407 SOS 1,358 200 6.910 127 171,206 4.80 49 50 -350 & SESS 925 3 -990 6.60 02 -28 5043 ,005 7.286 5536 Nasdaq 100(CME)-$200 x Index June 2297.50 2326.00 2290.00 2322.50 2.75 8 ,909 Mini Nasdag 100(CME-$20 x Index June 2296.823248 22895 2322.5 26.8 299.341 Sept 2297.0 23215 229732319. 5 263 113 Mini Res 2000 OCE-US) $100 x Index June 817.00 828.70 8 15,2082720 930 369.520 Sept 22.00 82200 200 24 0 0 Mini R e 1000 ACE-US) $100 index June 724.80 73150 A 722.30 731.30 8.10 16.653 U.S. Dollar Index (ICE-US)-51.000 index Sept 76.67 17.01 76677824 13 523 Source: Thomson Reuters

Answer 1

One July Soyabean oil contract is for 60000 lbs and the last price (settle) price of the day as 57.61cents/lb or $0.5761/ pound

if soybean oil prices turn out to be $0.4652 per pound at expiration

Profit = (Selling price per pound -buying price per pound ) * 60000 pounds

=(0.4652- 0.5761)* 60000 = - $6654

So, there will be a loss of $6654