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Now, the farmer trusts you and allowed another trade. This time, you decide to go long on the same contract. You buy 10 contracts at
Now, the farmer trusts you and allowed another trade. This time, you decide to go long on the same contract. You buy 10 contracts at 4.27 $/bu. This is Day 1. The initial margin (performance bond) is $730 per contract, and the maintenance level is $650 per contract. Each contract has 5,000 underlying bushels. You offset your position on Day 7. 10) (10 pts.) Calculate your final cumulative gains using the table below: Trade price 4.27 Settlement price Cumulative gain Margin account balance Margin call Daily gain Day 1 1 2 4.21 4.23 4.25 3 4 4.22 5 4.28 6 4.25 7 4.29 Now, the farmer trusts you and allowed another trade. This time, you decide to go long on the same contract. You buy 10 contracts at 4.27 $/bu. This is Day 1. The initial margin (performance bond) is $730 per contract, and the maintenance level is $650 per contract. Each contract has 5,000 underlying bushels. You offset your position on Day 7. 10) (10 pts.) Calculate your final cumulative gains using the table below: Trade price 4.27 Settlement price Cumulative gain Margin account balance Margin call Daily gain Day 1 1 2 4.21 4.23 4.25 3 4 4.22 5 4.28 6 4.25 7 4.29
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