If you took a short position in three S&P 500 futures contracts at a price of 2900 and closed the position when the index futures was 2885, you incurred
A) a gain of $11,250.
B) a loss of $11,250.
C) a loss of $8,000.
D) a gain of $8,000.
E) None of the options are correct.

Question

Quizplus · Accepted Answer

The gain from a short position is calculated by subtracting the closing price from the opening price. Here, the opening price is 2900 and the closing price is 2885, so the difference is 15 points. Each S&P 500 futures contract represents $250 per point, so for three contracts, the gain is 15 points * $250/point * 3 contracts = $11,250.

If You Took a Short Position in Three S&P 500