Exam 22: Futures Markets

You sold one corn future contract at $2.29 per bushel.What would be your profit (loss) at maturity if the corn spot price at that time were $2.10 per bushel Assume the contract size is 5,000 ounces and there are no transactions costs.

Some of the newer futures contracts include I) fashion futures. II) weather futures. III) electricity futures. IV) entertainment futures.

The establishment of a futures market in a commodity should not have a major impact on spot prices because

Discuss marking to market and margin accounts in the futures market.

Metals and energy currency futures contracts are actively traded on

An investor with a long position in Treasury notes futures will profit if

To hedge a long position in Treasury bonds, an investor most likely would

The terms of futures contracts such as the quality and quantity of the commodity and the delivery date are

Which one of the following statements regarding delivery is true

The expectations hypothesis of futures pricing

You sold one silver future contract at $3 per ounce.What would be your profit (loss) at maturity if the silver spot price at that time is $4.10 per ounce Assume the contract size is 5,000 ounces and there are no transactions costs.

Delivery of stock index futures

Agricultural futures contracts are actively traded on

Distinguish between the short and long positions in futures transactions.

Which one of the following statements regarding "basis" is true I. The basis is the difference between the futures price and the spot price. II. The basis risk is borne by the hedger. III. A short hedger suffers losses when the basis decreases. IV. The basis increases when the futures price increases by more than the spot price.

You purchased one corn future contract at $2.29 per bushel.What would be your profit (loss) at maturity if the corn spot price at that time were $2.10 per bushel Assume the contract size is 5,000 ounces and there are no transactions costs.

Describe the types of traders that are active in the futures markets.Explain why each type is in the markets and how their goals differ.Give an example of how each might use the market.

You bought one soybean future contract at $5.13 per bushel.What would be your profit (loss) at maturity if the wheat spot price at that time were $5.26 per bushel Assume the contract size is 5,000 ounces and there are no transactions costs.

Investors who take long positions in futures agree to __________ of the commodity on the delivery date, and those who take the short positions agree to __________ of the commodity.

On April 1, you sold one S&P 500 Index futures contract at a futures price of 1,550.If on June 15 the futures price were 1,612, what would be your profit (loss) if you closed your position (without considering transactions costs)