Question

On 3 May 2019, a speculator buys five July 2019 US Soybeans futures contracts at a price of 842 cents per bushel. The speculator closes out her futures position on 30 May 2019 at a price of 888.88 cent per bushel. The US Soybeans futures contract is written on 5,000 bushels of soybeans and, for a speculator, the initial and maintenance margins are $3,375 and $2,500 per contract respectively. Assume that the speculator does not withdraw any excess out of their margin account.

1. At the time the futures position is established, what is the minimum price movement that will generate a margin call? Report your answer in cents with 2 decimal places (2 dps).
   
2. Construct a table as below to illustrate the daily marking-to-market (and final settlement) of the speculator’s overall futures position.

Table Q2

Day	Date	Trade price (¢)	Settlement price (¢)	Daily gain ($)	Cumulative gain ($)	Margin account balance ($)	Margin call ($)
1
1
2
3
…

c. What is the overall profit/loss of the speculator? Decompose the overall profit/loss into two components: (i) total margin calls, and (ii) the change in the margin account balance.

Answer 1

For this question already i have solved the answer.... But in that question they have given the Settlement price's for each day i am attaching the same answer....

For better understanding given below formulas used in excell.