Corn 5,000 bushels Contract Month Open Mar May July Sep High Low Settle chg open

Question

Corn 5,000 bushels Contract Month Open Mar May July Sep High Low Settle chg open Int 455.125 457.000 451.750 452.000-2.750 597,913 467.000 468.000 463.000 463.250 -2.750 137,547 477.000 477.500 472.500 473.000-2.000 153,164 475.000 475.500 471.750 472.250 -2.000 29,258 Suppose you sell 19 of the May corn futures at the high price of the day. You close your position later when the price is 467.750. lgnoring commission, what is your dollar profit on this transaction? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Explanation / Answer

High price of the day for May contract = $468

Future was sold at the high price i.e. $468 and bought at the price of $467.750

Hence, profit per future contract = 468 - 467.750

= $0.25

Number of future contracts = 19

Hence, total profit earned = Number of contracts x profit per contract

= 19 x 0.25

= $4.75

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