Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / One Chicago has just introduced a new single stock futures contract on the stock of Brande...

One Chicago has just introduced a new single stock futures contract on the stock of Brandex, a company that currently pays no dividends Each contract calls for delivery of 1000 shares of stock in

  1. One Chicago has just introduced a new single stock futures contract on the stock of Brandex, a company that currently pays no dividends. Each contract calls for delivery of 1,000 shares of stock in one year. The T-bill rate is 6% per year. (LO 17-3)

  1. If Brandex stock now sells at $120 per share, what should the futures price be?

  2. If the Brandex stock price drops by 3%, what will be the change in the futures price and the change in the investor’s margin account?

  3. If the margin on the contract is $12,000, what is the percentage return on the investor’s position?

Jun 16 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions