Maintenance margin = 600$ Assume the volatility of Soybean Oil immediately increases 20%. How will it impact Futures price? How will it impact investor's margin account requirement? Explain your answer.

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Initial Futures Contract price = 0.1529$ per Ib
Contract size = 60000 lbs
Initial Margin requirement = 10 %
Maintenance margin = 600$
Assume the volatility of Soybean Oil immediately increases 20%. How will it impact Futures price?
How will it impact investor's margin account requirement? Explain your answer.
Transcribed Image Text:Finance Initial Futures Contract price = 0.1529$ per Ib Contract size = 60000 lbs Initial Margin requirement = 10 % Maintenance margin = 600$ Assume the volatility of Soybean Oil immediately increases 20%. How will it impact Futures price? How will it impact investor's margin account requirement? Explain your answer.
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