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George Seby is thinking about doing some speculating in interest rates. He thinks rates will fall and, in response, the price of Treasury bond futures
George Seby is thinking about doing some speculating in interest rates. He thinks rates will fall and, in response, the price of Treasury bond futures should move from
90
-26.3
,
their present quote, to a level of about
97
.
Given a required margin deposit of
$ 1 comma 040
per contract, what would George's return on invested capital be if prices behave as he expects?
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