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CMA Final · Strategic Financial Management · Forwards and Futures

Ananya Traders buys 1 Nifty futures contract of lot size 50 at 22,000. The initial margin is 10% of contract value. On day 1 the futures settle at 21,900 and on day 2 at 22,060. What is the cumulative mark-to-market gain/(loss) credited/(debited) to her account at the end of day 2?

The cumulative mark-to-market is a gain of ₹3,000. Day 1 loses 100 points × 50 = ₹5,000, day 2 gains 160 points × 50 = ₹8,000, so net gain is ₹3,000, equal to the 60-point rise from purchase price times lot size.

  1. AGain of ₹3,000Correct
  2. BGain of ₹8,000
  3. CLoss of ₹5,000
  4. DLoss of ₹3,000

Explanation

Day 1: (21,900 − 22,000) × 50 = −₹5,000. Day 2: (22,060 − 21,900) × 50 = +₹8,000. Net = +₹3,000, which equals (22,060 − 22,000) × 50. Option ₹8,000 ignores the day 1 loss. Initial margin does not affect MTM.

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