Don Vittlecrammer is your boss. Don is very smart, but also very busy. After reading an article in the Daily Bacon, he decided to buy a pork bellies futures contract. Don doesn$$t have the time to follow his investment, so he$$s asked you to monitor it for him and let him know how it$$s doing. He informs you that he$$s already transferred the initial margin of $$4,000$ to his broker and that the maintenance margin is $$3,000.$ Contract size is $40,000$ pounds.Question $1$ Data

$($End of Day$)$ Pork Bellies Equity in Account Margin Action Futures Price$($$$/$lb$)$

$1$ $$1\mathrm{.}00$ $$4,000$ initial deposit

$2$ $$1\mathrm{.}01$

$3$ $$1\mathrm{.}03$

$4$ $$0\mathrm{.}99$

$5$ $$0\mathrm{.}95$

$6$ $$0\mathrm{.}97$

$7$ $$0\mathrm{.}97$

$8$ $$0\mathrm{.}99$

$9$ $$1\mathrm{.}01$ Prices for the first nine trading days are listed in the table above. Assuming the information Don has given you is correct, on what day will he receive his first margin call, and how much money will he need to transfer to his margin account?

Shortly after the markets close on Day $3,$ Don comes storming into your office, shouting $$My broker just called and says I owe him a margin call! Why didn$$t you tell me$,$ dammit?!!$$ After much head$-$scratching and a phone call to the broker, you determine that your boss had mistakenly taken a short position in pork bellies, contrary to what he$$d told you initially. Given this new information, calculate the amount needed to satisfy the margin call on Day

On Day $9,$ Don decides you$$re spending far too much time on the CME website and decides to buy back his short position in pork bellies. Assuming he exactly satisfied all margin calls and never withdrew any excess funds, what will be his final balance when he closes out his position? What was the net gain or loss on his investment?