You are given the following information about a portfolio you are to manage.For the long-term you are bullish, but you think the market may fall over the next month. For a 200-point drop in the S&P 500, by how much does the value of the futures position change
A)$200,000
B)$50,000
C)$250,000
D)$500,000
E)$100,000

Question

You are given the following information about a portfolio you are to manage.For the long-term you are bullish, but you think the market may fall over the next month.  For a 200-point drop in the S&P 500, by how much does the value of the futures position change
A)$200,000 
B)$50,000 
C)$250,000 
D)$500,000 
E)$100,000

Quizplus · Accepted Answer

The change is 200 points times the $250 multiplier, which equals $50,000.

You Are Given the Following Information About a Portfolio You