Tree Row Bank wishes to take a position in Treasury bond futures contracts, which currently have a
Question:
Tree Row Bank wishes to take a position in Treasury bond futures contracts, which currently have a quote of 95-040. Tree Row thinks interest rates will go up over the period of investment. (LG 10-2)
a. Should the bank go long or short on the futures contracts?
b. Calculate the net profit to Tree Row Bank if the price of the futures contracts decreases to 94-280.
c. Calculate the net profit to Tree Row Bank if the price of the futures contracts increases to 95-210.
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Related Book For 
Financial Markets And Institutions
ISBN: 9781259919718
7th Edition
Authors: Anthony Saunders, Marcia Cornett
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