Question

In: Finance

One day, investor A takes a long position in 10 contracts of a certain futures, and...

One day, investor A takes a long position in 10 contracts of a certain futures, and investor B takes a short position in 10 contracts of the same futures. If this is the only transaction for the futures on the day, the trading volume for the futures is 20.

Group of answer choices

True/ False

Solutions

Expert Solution

True :

Reason : Volume of trade, also known as trading volume, refers to the quantity of shares or contracts that belong to a given security traded on a daily basis. In other words, trading volume provides a measure of the number of shares that are transacted between a given time period.

Here 2 contracts are executed on the same security 10+ 10

Hence trading volume is 20.

Answer is True.

jeff jeffy answered 2 years ago
Next > < Previous

Related Solutions

an investor takes a long position in one futures contract on gold, when the futures price...
an investor takes a long position in one futures contract on gold, when the futures price is $1900. one contract us for 100 troy ounces of gold. the contract is closed out when the futures price is $1,960. which is true? investor made a loss of $4000 investor made a gain if $6000 investor made a loss of $6000 investor made a gain of $4000
A company takes a short position in 10 futures contracts on soybean on October 2, 2020....
A company takes a short position in 10 futures contracts on soybean on October 2, 2020. The initial futures price is $10.175 per bushel. Suppose on December 31, 2020 the futures price is $10.02 per bushel. On March 20, 2021 it is $9.89 per bushel. The contracts are closed out on March 20, 2021. What gain is recognized (taxable) in the accounting year January 1 to December 31, 2021 if the company is classified as a hedger? Each contract is...
Suppose that an investor enters a long position in futures on date 0. If the futures...
Suppose that an investor enters a long position in futures on date 0. If the futures price increases on date 1, the investor's margin account balance will increase. Group of answer choices True False
An investor takes long position in five August Gold futures contract. Each contract size is 100...
An investor takes long position in five August Gold futures contract. Each contract size is 100 troy ounces. Futures price is $1356.20. Initial margin requirement is $3,500 per contract and the maintenance margin is $2,500 per contract. Find out at what price the margin call will take place? After the margin call, how much the investor will have to deposit in the margin account?
One day, a long position in a futures contract sees gain from a daily settlement. Then,...
One day, a long position in a futures contract sees gain from a daily settlement. Then, a short position in the same contract sees loss from the daily settlement. Group of answer choices True False
On date 0, an investor starts a short position in one futures contract on Bitcoin. One...
On date 0, an investor starts a short position in one futures contract on Bitcoin. One contract is for delivery of 5 Bitcoins. Following are the future prices on subsequent dates. What is the cumulative gain for the investor from date 0 through date 5? Assume that the risk-free rate is zero. Date Bitcoin futures price ($ per 1 Bitcoin) 0 11,410 1 11,784 2 12,005 3 11,568 4 11,235 5 10,912
An investor enters into 5 S&P 500 long futures contracts, each of which is currently trading...
An investor enters into 5 S&P 500 long futures contracts, each of which is currently trading at 2,150. You are given: Each contract has a notional value equal to 250 times the futures price. The initial margin is 10% of the notional value. The maintenance margin is 80% of the initial margin. The margin balance earns a continuously compounded risk-free interest rate of 5%. Suppose the futures price one day later is 2,100 and the investor receives a margin call....
You took a short futures position in 10 contracts, covering each 100 ounces of gold at...
You took a short futures position in 10 contracts, covering each 100 ounces of gold at a price of $276.5 per ounce. The initial and the maintenance margin requirement are respectively $1500 and is $1100 per contract. No withdrawal in any excess margin will be made. Ignore any interest on the balance. The settlement prices per ounce of gold at the end of days 1, 2 and 3 are respectively $278, $281 and $276. (c) Calculate your total gain or...
You took a short futures position in 10 contracts, covering each 100 ounces of gold at...
You took a short futures position in 10 contracts, covering each 100 ounces of gold at a price of $276.5 per ounce. The initial and the maintenance margin requirement are respectively $1500 and is $1100 per contract. No withdrawal in any excess margin will be made. Ignore any interest on the balance. (b) The settlement prices per ounce of gold at the end of days 1, 2 and 3 are respectively $278, $281 and $276. Complete the table below assuming...
A trader takes the long position and a hedge fund takes a short position on ten...
A trader takes the long position and a hedge fund takes a short position on ten 1-month S&P 500 futures contracts at 2500. A single S&P 500 futures contract equals ($250) × (Index Value). The initial margin is $325,000 and the maintenance margin is $245,000 for both accounts. Five trading days later, the futures price of the index drops to 2,460 triggering a margin call for the trader. What is the change margin account balance (indicate gain or loss) for:...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT