On January 1, you bought one April S&P 500 index futures contract at a futures price of 3,420. If, on February 1, the April futures price was 3,430, what would be your profit (loss) if you closed your position (without considering transactions costs)?
A) $2,500 loss
B) $10 loss
C) $2,500 profit
D) $10 profit

Question

Quizplus · Accepted Answer

The profit from a futures contract is calculated by taking the difference between the selling price and the buying price, then multiplying by the contract multiplier. For S&P 500 index futures, the contract multiplier is typically $250. Since the futures price increased from 3,420 to 3,430, the profit is (3,430 - 3,420) * $250 = $2,500.

On January 1, You Bought One April S&P 500 Index