I am working on setting up the following problem and would appreciate receiving assistance:
The futures contract quote on 5,000 bushels of soybeans traded on the CBOT, Monday, December 31, 2001 was:
Open: 423-3/4 ($4.2375/bushel)
High: 424 ($4.24/bushel)
Low: 419-1/2 ($4.1950/bushel)
Settle: 421 ($4.21/bushel)
You shorted 3 contracts at $4.22 on December 31, 2001
The settlement for January 2, 2002 was $4.18 (the markets closed on New Years). If you had to post a $1,000 initial margin per contract upon placing the trade, what would be your trade account balance at the close of January 2, 2002?
Loss per bushel = 4.22-4.18 = 0.04
Total Dollar loss = .04 * 5,000 * 3 ...
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