Following is an example of daily settlement (marking to market) with a futures contract. Calculate the cash flow according to each action. On June 10 (Monday), Wayne goes LONG one IMM yen futures contract at an opening price of $0.00767. The settlement prices for June 10, 11, and 12 are $0.00887, $0.00845, and $0.00921, respectively. On June 13, Wayne closes out the contract at a price of $0.00812. Initial and maintenance margin requirements for yen are $1,890 and $1,400, respectively. Time Action Cash Flow Monday morning Wayne buys one IMM yen futures that matures in three days. Price is $0.00767 for Y12,500,000. Monday close Futures price ups to $0.00887. Position is marked-to market. Tuesday close Futures price drops to $0.00845. Position is marked-to-market. Wednesday close Futures price rises to $0.00921. Position is marked-to-market. Thursday close Futures price drops to $0.00812. 1) Contract is marked-to-market 2)

He closes out the contract.