Question
Suppose that on September 5, 2021, a company takes a long position in four December 2021 crude oil futures contracts. One contract is for the
Suppose that on September 5, 2021, a company takes a long position in four December 2021 crude oil futures contracts. One contract is for the delivery of 1000 barrels of crude oil. The initial margin for each contract is $4,000 and the maintenance margin is $2,500. The futures price is $46.06 per barrel when the company enters into the contract. a. At the end of the first day, the settlement price at the end of the day is $46.23 per barrel: i) . Calculate the balance of the margin account. ? If the company receives a margin call at the end of the second day to deposit a variation margin of $6526, what is the settlement price at the end of the second day?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started