|
You think the index is going down,
so you sell an index future CFD. The index closes down, so the
mark-to-market adjustment lowers your total margin requirement.
The next day, the index rises, so the value of the position falls,
and there is also an increased maintenance margin requirement.
The total margin requirement therefore increases, but you have
enough to cover it for the time being. On the third day, the index
falls, and you buy to close the position, for a profit.
| Short Index Future CFD example |
€
|
| Account |
€ |
|
| Monday (Trade date) |
|
| |
|
| FIB30 index 32,650-32675 |
|
| Opening Ledger Balance |
20,000 |
| Stake per tick |
10
|
| Settlement |
0 |
| FIB30 Index Bid price SELL @ |
16.50
|
| Closing Ledger Balance |
20,000 |
| Index closing price |
32,500
|
| Mark to market |
1,500 |
| |
|
| Margin requirement |
(15,000) |
| |
|
| Excess/(deficit) funds |
6,500 |
| |
|
| Ledger interest accrued |
0.46 |
|
| Tuesday (T+1) |
|
| |
|
| Index closing price |
32,800
|
| Opening Ledger Balance |
20,000 |
| |
|
| Settlement |
0 |
| |
|
| Closing Ledger Balance |
(7) |
| |
|
| Mark to market |
(1,500) |
| |
|
| Margin requirement |
(15,000) |
| |
|
| Excess/(deficit) funds |
3,500) |
| |
|
| Ledger interest accrued |
0.46 |
|
| Wednesday (T+2) |
|
| Opening ledger balance |
20,000 |
| FIB30 Index 32,125-32,150 |
|
| Settlement |
5,000 |
| FIB30 Index Bid price BUY @L |
32,150
|
| Ledger balance |
25,000 |
| |
|
| Ledger interest accrued |
0.57 |
| |
|
| Total ledger interest accrued |
1.48 |
|
| IFX credit rate |
+1.75%
|
| Interest |
1.48 |
| IFX deposit rate |
-1.00%
|
| Profit/(Loss) |
5,001 |
| Central rate (€) |
1.82%
|
| Return on balance |
25.0% |
| Deposit interest rate |
0.82%
|
| Share price movement |
-1.5% |
| Days in year |
360
|
| Margin requirement |
1,500 |
|
|
