What is the purpose of requiring a margin on a futures or option transaction? What is the difference between an initial margin and a maintenance margin?
Answer to relevant QuestionsRefer to Table. a. If you think 15-year Treasury note prices will fall between August 7, 2013, and March 2014, what type of futures position would you take? b. If you think inflation in Japan will increase by more than that ...What factors affect the value of an option?You have taken a long position in a call option on IBM common stock. The option has an exercise price of $ 176 and IBM’s stock currently trades at $ 180. The option premium is $ 5 per contract. a. How much of the option ...A commercial bank has $ 200 million of floating-rate loans yielding the T-bill rate plus 2 percent. These loans are financed with $ 200 million of fixed-rate deposits costing 9 percent. A savings bank has $ 200 million of ...What is meant by an off-balance-sheet activity? What are some of the forces responsible for them?
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