4. You are a speculator in stock index futures. You are bullish on the market, especially blue chip stocks. You find tha
Posted: Thu May 05, 2022 8:04 am
4. You are a speculator in stock index futures. You are bullish on the market, especially blue chip stocks. You find that the Dow Jones Industrial Average (DJIA) future contracts trades at $10 x index and is currently trading at 12427. a. What position should you take? b. If you have to put down 5% of the contract size as the initial margin, what is your deposit for one contract? c. Calculate your ROIC for one contract if DJIA June increases by 10%?