Exam 2: Futures Markets

You go short oil 10 futures contracts on NYMEX when the futures price of oil is $79 a barrel and close out your position three days later at a futures price of $83 a barrel.One futures contract is for 1,000 barrels.Ignoring interest on the margin account,the futures trading has resulted in a

When a counterparty to a futures contract fails to perform under the contract,

A calendar spread futures position comprises

An investor enters into a long position in 10 gold futures contracts at a futures price of $1000/oz and closes out the position at a price of $1020/oz.If one gold futures contract is for 50 ounces,what are the investor's gains or losses?

Plutonium is trading at a one-year futures price of $5,000 per gram.A futures contract comprises 100 grams.The initial margin is $100,000 and the maintenance margin is $80,000.You are short one futures contract.There is a margin call when the price per gram of plutonium changes to

Ignoring convenience yields,the theoretical futures price for a commodity with a positive cost of carry should typically exhibit

September corn futures are currently trading at $3.80 a bushel while the spot price of corn is $3.65 a bushel,so the "basis" (the futures price minus the spot price)is $0.15 a bushel.If you expect the basis to weaken (i.e. ,to fall)significantly in the next few days,you can speculate on your view by

A price tick is

March what futures are trading at $4.20 a bushel and May wheat futures are trading at $4.35 a bushel.You expect the spread between May and March futures prices to widen.To speculate on this view,you would

The cheapest-to-deliver option

If the market is in backwardation

The level of margining in a futures contract takes as an important input

Which of the following features distinguish futures markets from forwards markets?

When the futures-spot basis weakens

For a futures contract on an asset to be successful compared to the alternative of forward contracts,which of the following features would help?

Futures contracts are more likely to be cash-settled when

In the absence of arbitrage,the futures price at maturity should equal

A "stack-and-roll" strategy makes profits from the "roll" part when

Which of the following types of orders does not involve specifying a price limit or trigger price as part of the order?

The most widely traded futures are of the following type: