Business, 17.02.2020 20:20, joycetleiji1

On January 31, a company takes a short position in June futures on 185,000 oz of silver at $17.7550/oz. The size of one contract is 5,000 oz. The initial margin is $15,960 per contract and the maintenance margin is $13,300 per contract.

a. How much money has to be deposited as the initial margin for the whole position?
b. What is the smallest price change that would lead to a margin call?
c. What should be the closing price of June silver futures on January 31, for the exchange to withdraw $48,433.00 from the margin account in the process of daily settlement?
d. What should be the closing price of June silver futures on January 31, for the exchange to deposit $90,483.50 to the margin account in the process of daily settlement?
e. What amount (if any) would be required to be deposited by the company to the margin account if the closing price of June silver futures on January 31 were $18.4147/oz?

Answers: 3

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On January 31, a company takes a short position in June futures on 185,000 oz of silver at $17.7550/...