
Futures Contracts 89
Gain = Dierence in futures price × Contract size × Number of contracts
= (5,640 – 5,600) × 50 × 5 = INR 10,000
is gain is added to the margin amount, and the margin account balance will be INR 70,000 + INR
10,000 = INR 80,000. Instead of increasing to INR 5,640, if the price decreased to INR 5,560, the trader
will make a loss.
Loss = Dierence in futures price × Contract size × Number of contracts
= (5,600 – 5,560) × 50 × 5 = INR 10,000
is loss is subtracted from the margin amount, and the balance in the margin account will be equal to
INR 70,000 – INR 10,000 = INR 60,000.
It is necessary that the CMs post margins whenever ...