Question

You are considering the purchase of futures on PLATINUM. At what point would you get a margin call if the underlying declined? Provide your answer to the PENNY per ounce of PLATINUM. 937,09 935.50 938.63 937.94 936.28

Answer 1

To determine the point at which you would get a margin call if you purchased futures on platinum, you need to know the initial margin requirement and maintenance margin requirement for the specific futures contract you are trading.

Assuming an initial margin requirement of 5% and a maintenance margin requirement of 3%, the point at which you would get a margin call if the underlying platinum price declined would be when the price of platinum falls by 2% (the difference between the initial margin requirement and the maintenance margin requirement).

Given the prices provided, the price of platinum closest to a 2% decline from 937.09 (the highest price given) is $918.48 per ounce of platinum.

Therefore, if you purchased futures on platinum with an initial margin requirement of 5% and a maintenance margin requirement of 3% and the price of platinum declined to $918.48 per ounce, you would receive a margin call.

Answer 2

could you explain this a bit more so i can give you a correct answer