4. The table below shows settlement prices for natural gas futures. One contract represents 10,000...
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4. The table below shows settlement prices for natural gas futures. One contract represents 10,000 MMBtu. Prices are quoted in dollars and cents per MMBtu, out to three digits, e.g., "tenths of a cent." The initial performance bond for one contract is $5,500. The maintenance performance bond is $5,000. A trader enters the market on Monday, January 3 at 10:00 am at a price of $3.594 in a long position for three (3) contracts. (a) How much money did the trader make or lose on their first day of trading? (b) Cnmulata tha arrountinatahla (c) If a margin call or calls were issued, on what day or days were they issued? How much money was the trader required to provide to their broker (assume they deposit the minimum required amount)? (d) Assuming the trader got into the market on Monday, January 3 at 10:00 am at a price of $3.594 and stayed in the market until the end of the day on Friday, January 7 , what was their gain or loss? Show or explain how you got your answer. (e) What would the trader's gain or loss have been if they had chosen to wait until the end of the day on January 3 to enter the market, i.e., the entered when the price was $3.554/MMBtu. (f) Go back to the original problem (ignore the question in part e). If the trader had traded one contract rather than three, what would their gain or loss have been, again assuming that they got into the market on Monday, January 3 at 10:00 am at a price of $3.594 and stayed in the market until the end of the day on Friday, January 7
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