On March 10, WSJ reported that "Nickel Market Freeze Extended to Sort Out Big Trading Loss Amid Ukraine War":

"The article reported that "London's nickel market will stay closed at least until next week, giving the London Metal Exchange more time to resolve a crisis caused by a huge loss-making trade originating in China. The LME closed trading in nickel after a huge run-up in prices inflicted severe financial pressure on producers that had sold nickel forwards on the LME as a hedge. The biggest loser was Tsingshan Holding Group, the world's largest nickel producer, which had built up the biggest short position in the metal."

Assume Gideon is a commodities trader at Goldman Sachs. On March 10, he had a long position in 100 Nickel Futures. The future contract promises the delivery of 200 tones of Nickel. The future price of Nickel per ton is $64,093.00. March 15 is the maturity date of these futures. Traders believe that if the market were open, the spot price for Nickels would be $100,000 per ton.

Please answer the following questions.

• Estimate Gideon's paper loss/gain in this position on the maturity date. Show your work fully.( 10 Points)
• Will this gain/loss be realized? Meaning, will Gideon actually lose or gain money on March 15? Explain your answer fully and support your answer with the relevant payoff diagram. ( 10 Points)
• Conversely, William, now working for Morgan Stanley, has a long position. Indeed, William is Gideon's counterparty in this transaction. What would be William's "realized" and "paper" losses/gains? ( 10 Points)

Gideon has LONG positon and William has SHORT positon