When opening a new position on futures contract, a broker requires initial margin of 15% (of the initial contract size). The broker requires an investor to replenish his margin account when the balance falls below the maintenance margin of 10% (of initial contract size). What is the margin account balance of short trader at t-3? Futures prices each day are given below. They opened 10 contracts, and contract size is 100 bushels. t-0 (initial trade) t-1 t-2 t-3 a) $150 b) $240 c) $120 d) $60 Futures Price (per bushel) $0.4 $0.45 $0.35 $0.36 Long Position Margin Short Position Margin ???
When opening a new position on futures contract, a broker requires initial margin of 15% (of the initial contract size). The broker requires an investor to replenish his margin account when the balance falls below the maintenance margin of 10% (of initial contract size). What is the margin account balance of short trader at t-3? Futures prices each day are given below. They opened 10 contracts, and contract size is 100 bushels. t-0 (initial trade) t-1 t-2 t-3 a) $150 b) $240 c) $120 d) $60 Futures Price (per bushel) $0.4 $0.45 $0.35 $0.36 Long Position Margin Short Position Margin ???
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Transcribed Image Text:When opening a new position on futures contract, a broker requires initial margin of
15% (of the initial contract size). The broker requires an investor to replenish his
margin account when the balance falls below the maintenance margin of 10% (of
initial contract size). What is the margin account balance of short trader at t=3?
Futures prices each day are given below. They opened 10 contracts, and contract
size is 100 bushels.
t-0 (initial trade)
t-1
t-2
t=3
a) $150
Ob) $240
Oc) $120
d) $60
Futures Price
(per bushel)
$0.4
$0.45
$0.35
$0.36
Long Position Margin Short Position Margin
???
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