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25 January, 18:33

Three days ago, you entered into a futures contract to sell €62,500 at $1.50 per €. Over the past three days the contract has settled at $1.50, $1.52, and $1.54. How much have you made or lost? Multiple Choice a. Lost $0.04 per € or $2,500 b. Made $0.04 per € or $2,500 c. Lost $0.06 per € or $3,750

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  1. 25 January, 20:57
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    Option A is correct one.

    Lost $0.04 per € or $2,500

    Explanation:

    Since we are selling the futures contract. Hence we will suffer loss i. e when the price is rising.

    Hence total loss = (1.50-1.54) * 62500 = $2500
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