If you sell in March a bond future contract for 115 that matures on June 30 of the same year, and at the maturity date the same future sells for 110, you have a ________ of $________.
A) loss; 5000
B) loss; 5
C) profit; 5000
D) profit; 5

Question

Quizplus · Accepted Answer

Selling a bond future contract at a higher price (115) and then it decreasing in value to a lower price (110) at maturity results in a profit. The difference in the contract value represents a gain, not a loss. The specific monetary value of the profit depends on the contract size and the price point movement, which in this context is not detailed, but the principle of selling high and settling at a lower price indicates a profit scenario.

If You Sell in March a Bond Future Contract for 115