On September 1, Ashok Leyland shares are selling at INR 40.35. Ashok Leyland futures have a...

 

Transcribed Image Text:

On September 1, Ashok Leyland shares are selling at INR 40.35. Ashok Leyland futures have a contract size of 9,550. The September futures expiring on September 28 are priced at INR 41.25, and the October futures expiring on October 26 are priced at INR 41.54. The initial margin requirement is 5% of the contract value. On September 28, the shares of Ashok Leyland are selling at INR 41.83. (i) If you buy one September contract, what is the value of the contract? (ii) How much money do you need to post as the margin? (iii) What would be the amount of cash settlement for a September contract? On September 1, Ashok Leyland shares are selling at INR 40.35. Ashok Leyland futures have a contract size of 9,550. The September futures expiring on September 28 are priced at INR 41.25, and the October futures expiring on October 26 are priced at INR 41.54. The initial margin requirement is 5% of the contract value. On September 28, the shares of Ashok Leyland are selling at INR 41.83. (i) If you buy one September contract, what is the value of the contract? (ii) How much money do you need to post as the margin? (iii) What would be the amount of cash settlement for a September contract?

Answer rating: 100% (QA)

i Value of contract Futures Price Contract size 4125 95... View the full answer