An investor takes a short position in September wheat futures contract on June 5,

Contract size is 1000 bushel

Futures price is $85

Initial margin is 10% and the maintenance margin is 6%.

1. What is the purpose of the maintenance margin?

2. Calculate the initial margin and the maintenance margin.

3. Fill out the following table:

Day	Trade price	Settle price	Daily gain	Cumulative gain	Margin balance	Margin call
1	$85
2		$87
3		$90
4		$89
5		$94
6		$92
7		$93.5

4. Calculate the profitability of the contract using two different methods.