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Estimate your dollar return and percentage return

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Question - The future price of Gold for August 2022 delivery is $1,920. Future contracts are for 100 ounce of gold and assume that the margin requirement is $6,000 per contract and the maintenance margin requirement is 4,000. You expect the price of gold to rise, and you buy one August Gold contract at a price of $1,920.

How much you need to have in your account to buy one future contract?

Assume you buy one August gold contract at $1,920, and gold price goes up and you sell your August future contract at a price of 2,020. Estimate your Dollar return and percentage return.

If gold price goes down and you sell your future contract at $1650, what is your percentage loss?

Reference no: EM133124749

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