What shall be joan margin account balance at the end

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Problem 1: On 1/30 at the end of the day, Joan sold (took a short position in) 1 futures contract (one contract is agreement to buy or sell Euros 45,500) at a rate of USD 1.35 per Euro, contract expires on 6/18. Initial margin=$1,330 and maintenance margin is $1,005. On 1/31 and 2/1, the futures rate expiring on 6/18 is USD 1.365, and USD 1.370 respectively. As per "Marked to Market" daily mechanism of currency futures contracts, what shall be Joan's margin account balance at the end of 1/31(Assuming that Joan will not withdraw money from her margin account)?

A. On 1/31, Joan received a margin call from the broker to deposit $682.5 to bring up her margin balance on 1/31 back to $1,330.
B. On 1/31, Joan received a margin call from the broker to deposit $357.5 to bring up her margin balance on 1/31 back to $1,005.
C. On 1/31, Joan's margin balance was $2,012.5 due to the gain of $682.5 realized from the change in the futures rate.
D. On 1/31, Joan's margin balance was $647.5 due to the loss of $682.5 realized from the change in the futures rate.

Reference no: EM132998022

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