Tony Begay, a currency trader for Chicago-based Saguaro Funds, uses futures quotes on the British pound (?) to speculate on the value of the pound. Use the futures quotes in the table to answer the following questions.

Required:

a. If Tony buys 5 June pound futures, and the spot rate at maturity is $1.3980/?, what is the value of her position?

b. If Tony sells 12 March pound futures, and the spot rate at maturity is $1.4560/?, what is the value of her position?

c. If Tony buys 3 March pound futures, and the spot rate at maturity is $1.4560/?, what is the value of her position?

d. If Tony sells 12 June pound futures, and the spot rate at maturity is $1.3980/?, what is the value of her position?

Problem 1. British Pound Futures, U.S.$/pound (CME) Maturity March June Open 1.4246 1.4164 High 1.4268 1.4188 Low 1.4214 1.4146 Settle 1.4228 1.4162 Contract Change 0.0032 0.0030 High 1.4700 1.4550 62,500 pounds Open Interest 25,605 809