Economics of Money and Banking on how to get your margin account balance any hel

Question

Economics of Money and Banking on how to get your margin account balance any help please and thank you

sume that on Friday August 1, you sell one Chicago Board of Trade September Treasury bond futures contract at the opening price of $97,800. The initial margin requirement is $2,500 and the maintainance margin equirement is $2,000. The settlement price of the contract at closing on that day is $97 400. The settlement pnce of the contract at closing on the next business day (August 4) is $98,000. Your margin account balance at the end of the day on August 4 is $_

Explanation / Answer

initial margin= $2500

maintenance margin= $2000

profit realized on closing day (August 1)= closing price on aug 1- opening price on aug 1

= 97400- 97800

= -$400

balance on aug 1= initial margin- profit/loss (note: should be greater than maintencnace margin)

= 2500- 400= $2100

profit realized on closing day (August 4)= closing price on aug 4- opening price on aug 4

= 98000- 97400

= $600

balance on aug 4= balance as on aug 1 + profit on august 4

= 2100 + 600= $2700

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