Question Details

[answered] 1c. One futures contract on orange juice is equal to 15,000


Hi I have 4 finance questions related to futures contracts. Thank you.?


1c. One futures contract on orange juice is equal to 15,000 lbs. of juice.

 

Recently, the contract was trading at around $ 1.46/lb. The initial margin for

 

an orange juice contract is $1,320, approximately what is the leverage an

 

investor enjoys by trading this commodity? 2a. On Nov. 28, 2016, the nearby S&P 500 contract closed at 2200.80.

 

What was the

 

total value represented by one S&P contract as of the day of that close? 2c. Assume that in two weeks, the contract closes at 2250. What would be

 

the dollar amount of your profit or loss, given the action you answered for

 

part b? Explain how you arrived at your answer. 2d. Currently, the initial margin requirement for an S&P futures contract is

 

$28,125, and the maintenance margin requirement is $22,500.

 

Given the profit you found in part c, calculate your percentage profit on the

 

trade, given what you had invested (the initial margin requirement). 2e. Assume now that the trade went against you, i.e., the price of the

 

contract goes down instead of up. At what contract price would you have

 

gotten a margin call? Explain. How much additional margin will you need to

 

deposit in your account?

 


Solution details:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: Sep 18, 2020

PRICE: $15

Solution~0001001911.zip (25.37 KB)

Buy this answer for only: $15

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free copy from our tutoring website www.aceyourhomework.com (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Sep 18, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN YOUR SET DEADLINE.

Order Now