An investor bought a March S&P 500 Index futures contract in December for $1,490.05. After six months the contract value went up to $1,539.95. The contract has a multiplier of 250. What is the dollar profit?
A)$1,996
B)$19,960
C)$12,475
D)$1,247.50
E)$199.60

Question

Quizplus · Accepted Answer

To find the dollar profit, we need to calculate the difference between the selling price and the buying price, and then multiply it by the contract multiplier.

Selling price = $1,539.95
Buying price = $1,490.05
Difference = $1,539.95 - $1,490.05 = $49.90

Dollar profit = Difference x Contract multiplier = $49.90 x 250 = $12,475

Therefore, the answer is C) $12,475.

An Investor Bought a March S&P 500 Index Futures Contract