At what price would you get a margin call

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Reference no: EM131325946

The crude oil futures contract on the New York Mercantile Exchange covers 1,000 barrels of crude oil. The contract is quoted in dollars and cents per barrel, e.g., $27.42, and the minimum price change is $0.01.

The initial margin requirement is $3,375 and the maintenance margin requirement is $2,500. Suppose that you bought a contract at $27.42, putting up the initial margin. At what price would you get a margin call?

Reference no: EM131325946

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