A margin call refers to:
A)the payment of profit by the clearinghouse to the trader.
B)the demand of funds by the clearinghouse from each trader to cover losses.
C)the difference between the futures market price and the contract price.
D)the close of a futures contract.

Question

Quizplus · Accepted Answer

A margin call is a demand from the clearinghouse for additional funds from a trader to cover potential losses in their futures contract. It is not related to the payment of profit or the difference between market and contract prices, nor does it necessarily result in the close of a futures contract.

A Margin Call Refers To