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5. Dudley Savings Bank wishes to take a position in Treasury bond futures contracts, which currently have a quote of 105 100. Dudley Savings thinks
5. Dudley Savings Bank wishes to take a position in Treasury bond futures contracts, which currently have a quote of 105 100. Dudley Savings thinks interest rates will go down 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 Dudley Savings Bank if the price of the futures contracts increases to 105-220. c. Calculate the net profit to Dudley Savings Bank if the price of the futures contracts decreases to 104280
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