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NISM Certifications · NISM-Series-VIII: Equity Derivatives · Introduction to Forwards and Futures

A trader buys 2 lots of Nifty futures, each lot of 75 units, at 22,000. At the day's settlement price of 22,060 the position is marked to market. What is the MTM credit or debit to the trader's account?

The trader receives an MTM credit of Rs 9,000. The long position gained 60 index points, and with 150 units across two lots of 75, the gain is 60 times 150, which equals Rs 9,000 credited to the account.

  1. ACredit of Rs 4,500
  2. BDebit of Rs 4,500
  3. CCredit of Rs 9,000Correct
  4. DDebit of Rs 9,000

Explanation

Gain per unit is 22,060 - 22,000 = 60 for a long position. Total units = 2 x 75 = 150. MTM = 60 x 150 = Rs 9,000 credit. Rs 4,500 uses only one lot, and a debit would apply to a short position.

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