Module 00 quiz

You sell 1 MOCHA50 futures contract at 24,000. On expiry it settles at 24,120. What happens?

You lose ₹6,000, and you must pay it.You let the contract lapse and lose nothing.You gain ₹6,000.You lose ₹120.

You buy 1 MOCHA50 futures contract at 24,000. The contract is worth 24,000 × 50 = ₹12,00,000. Assume the margin is 10%, so ₹1,20,000. The next day the index falls 2%. What happens to your account?

It loses ₹24,000, which is 20% of your margin, and the loss is debited today.It loses 2% of your margin, which is ₹2,400.Nothing happens yet, because losses settle only at expiry.It loses 10%, because that is the margin rate.

You buy a MOCHA50 call. Strike 24,200, premium ₹80, 20 days to expiry. The index stays at 24,000 for 10 days. Volatility does not change. What has most likely happened to the premium?

It has fallen.It is unchanged, because the index did not move.It has risen, because expiry is closer.It is zero.

You hold the same call: strike 24,200, premium ₹80. At expiry MOCHA50 settles at 24,250. What is your net result?

+₹2,500−₹1,500−₹4,000, because the option expires worthlessYou must now buy the index at 24,200.

MOCHA50 is at 24,000. The one-month future trades at 24,090. What happens to the 90-point gap by the close on expiry day?

It goes to about zero, because the future settles at the index price.It stays at 90 points until expiry.It rolls over into next month's contract by itself.The future settles at 24,090 no matter what the index does.

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