High School

We appreciate your visit to An investor has just entered 2 short palladium futures contracts at a futures price of 1 886 per troy ounce The size of each contract. This page offers clear insights and highlights the essential aspects of the topic. Our goal is to provide a helpful and engaging learning experience. Explore the content and find the answers you need!

An investor has just entered 2 short palladium futures contracts at a futures price of $1,886 per troy ounce. The size of each contract is 100 troy ounces. The initial margin is $20,000 per contract and the maintenance margin is $15,000 per contract. A month after opening the position the futures price rises to $1,913 per barrel. What is the balance of the total margin account at the end of the month? (Assume that no margin call has occurred over this period and your answer should be to the nearest dollar, without the dollar sign.)

Answer :

An investor has just entered 2 short palladium futures contracts at a futures price of $1,886 per troy ounce. The size of each contract is 100 troy ounces. Therefore, the answer is $331,800.

The initial margin is $20,000 per contract and the maintenance margin is $15,000 per contract. A month after opening the position the futures price rises to $1,913 per troy ounce. What is the balance of the total margin account at the end of the month? (Assume that no margin call has occurred over this period and your answer should be to the nearest dollar, without the dollar sign.)

When an investor enters 2 short palladium futures contracts at a futures price of $1,886 per troy ounce, the amount the investor received is `2*100*1886 = 377,200`.

For two futures contracts, the initial margin is $20,000 per contract and the total initial margin is $20,000 x 2 = $40,000.

The futures price then rose to $1,913 per troy ounce, for a loss of $27 per troy ounce and $2,700 per contract. The total loss is $2,700 x 2 = $5,400.

The balance of the total margin account at the end of the month is:377,200 - 5,400 - 40,000 = $331,800 (to the nearest dollar, without the dollar sign).

Learn more about investor Visit: brainly.com/question/30130634

#SPJ11

Thanks for taking the time to read An investor has just entered 2 short palladium futures contracts at a futures price of 1 886 per troy ounce The size of each contract. We hope the insights shared have been valuable and enhanced your understanding of the topic. Don�t hesitate to browse our website for more informative and engaging content!

Rewritten by : Barada