Sustain without getting margin call

Assignment Help Financial Management

Reference no: EM131935651

Suppose the initial margin on heating oil futures is $8,400, the maintenance margin is $7,200 per contract, and you establish a long position of 10 contracts today, where each contract represents 42,000 gallons. Tomorrow, the contract settles down $.04 from the previous day’s price. Are you subject to a margin call? What is the maximum price decline on the contract that you can sustain without getting a margin call?

Reference no: EM131935651

Questions Cloud

Determine the amount of potatoes and green beans : Case study: Reducing cafe costs - Determine the amount of potatoes and green beans Jane should purchase each week

What are the incremental operating cash flows : You have been asked by the president of Ellis Construction Company, headquartered in Toledo, to evaluate the proposed acquisition of a new earthmover.

Adjust the resulting operating income by the cost savings : This project will decrease the company's costs by $20,000 per year, while increasing revenues by $80,000 due to filling back-orders that had often become.

Barclays over the six-month period for eurodollar loan : How much will ABC pay in interest to Barclays over the six-month period for the Eurodollar loan?

Sustain without getting margin call : Are you subject to a margin call? What is the maximum price decline on the contract that you can sustain without getting a margin call?

What is business risk and what is financial risk : What is business risk? What is financial risk? Assume an all-equity firm starts to borrow with 30% debt ratio.

What is the indicated market value of the subject property : You have been asked to estimate the market value of an apartment complex that is producing annual net operating income of $78,000. three highly similar.

What will be the interest tax deduction for next year : You have asked the bank for a $300,000 mortgage at the beginning of this year (January 1 of this year). They have agreed to give you this mortgage at 8% annual.

Decision is based on the expected value concept : How many newspapers should the stand operator purchase if his decision is based on the expected value concept?

User Account

All Pages