Question: 4 (20 MARKS) (a) Explain how margin payments protect the clearing house (2 marks) (b) You deposited RM1,000 to buy: 10 contracts of XYZ Single

4 (20 MARKS) (a) Explain how margin payments protect the clearing house (2 marks) (b) You deposited RM1,000 to buy: 10 contracts of XYZ Single Stock Futures at RM3.00 per share Initial margin is set at RM100 per contract, with RM80 maintenance margin requirements. Below is the prices of the XYZ SSF DEC23 that ensue Trading Day Settlement Price per share (RM 3.30 3.05 294 3.25 Day 1 Day 2 Day 3 Day 4 Calculate the maintenance margin that you have to top up to maintain your open position (4 marks) Calculate your profit/ (loss) (loss) from position on Day 4. the above trading, should you close out all (4 marks)

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