Question
Assume the 5-day maturity futures price for silver is currently $20.10 per ounce. The futures contract allows for the delivery of 5,000 Ounces per contract.
Assume the 5-day maturity futures price for silver is currently $20.10 per ounce. The futures contract allows for the delivery of 5,000 Ounces per contract. Assume Ariana, now working as a derivatives engineer at State Street, has sold 200 such futures contracts. Suppose that over the next 5 days, the futures price evolves as follows:
Day Futures Price
0 (today) $20.10
1 20.20
2 20.25
3 20.18
4 20.18
5 (maturity)20.21
Draw a table and show the daily mark-to-market settlements for the whole position held by Ariana on behalf of State Street. (show your work fully)
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