You Buy a Standard & Poor's 500 Index Futures Contract

question 39

Essay

You buy a Standard & Poor's 500 Index futures contract at 1,200.40.The multiplier is 250.The margin is $21,000.The margin maintenance requirement is set at $17,250.
A.If the contract closes out at 1,230.70,what is your dollar return? What is your percent return on margin?
B.If the contract value goes down from $1,240.00 to $1,180.00,will you be called upon to put up more funds?

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Definitions:

Quantity Supplied

The total amount of a good or service that producers are willing and able to sell at a particular price over a specified period.

Quantity Demanded

The overall volume of a good or service that buyers are eager and capable of acquiring at a certain price within a specific period.

Pie Chart

A circular graph that shows how some total is divided among its components, usually expressed in percentages.

Relative Shares

The proportion of total income or wealth held by different groups within a society, often used to analyze income or wealth distribution.