Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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A currency speculator wants to speculate on the future movements of the E. The speculator expects the € to appreciate in the near future and
decides to concentrate on the nearby contract. The broker requires a 2% Initial Margin (IM) and the Maintenance Margin (MM) is 75% of IM.
Following € Futures quotes are currently available from the Chicago Mercantile Exchange (CME).
Euro (CME)-€125,000; S/E
Open Interest
255,420
19,335
June
1.2175 1.2259 -0.0018
Open High Low Settle Change
1.2216 1.2276
Sept 1.2229 1.2288
In addition to the information
trading:
1.2189 1.2269 -0.0018
provided above, consider the following CME quotes that are available at the end of day one's
Euro (CME) - €125,000; S/€
High
Low Settle Change Open Interest
Open
June 1.2216 1.2276 1.2175 1.2176 -0.0083 255,420
Sept 1.2229 1.2288 1.2189 1,2190 -0.0079
Which of the following is TRUE?
19,335
OA Cannot be determined, more information required.
OB. The Futures position will result in a LOSS of $1,037.50 at the end of day one's trading
OC The Futures position will result in a PROFIT of $1,037.50 at the end of day one's trading
OD. The Futures position will not be affected at the end of day one's trading.
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Transcribed Image Text:A currency speculator wants to speculate on the future movements of the E. The speculator expects the € to appreciate in the near future and decides to concentrate on the nearby contract. The broker requires a 2% Initial Margin (IM) and the Maintenance Margin (MM) is 75% of IM. Following € Futures quotes are currently available from the Chicago Mercantile Exchange (CME). Euro (CME)-€125,000; S/E Open Interest 255,420 19,335 June 1.2175 1.2259 -0.0018 Open High Low Settle Change 1.2216 1.2276 Sept 1.2229 1.2288 In addition to the information trading: 1.2189 1.2269 -0.0018 provided above, consider the following CME quotes that are available at the end of day one's Euro (CME) - €125,000; S/€ High Low Settle Change Open Interest Open June 1.2216 1.2276 1.2175 1.2176 -0.0083 255,420 Sept 1.2229 1.2288 1.2189 1,2190 -0.0079 Which of the following is TRUE? 19,335 OA Cannot be determined, more information required. OB. The Futures position will result in a LOSS of $1,037.50 at the end of day one's trading OC The Futures position will result in a PROFIT of $1,037.50 at the end of day one's trading OD. The Futures position will not be affected at the end of day one's trading.
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