Future Contract Asset (Fair Value Hedge)Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Future Contract Asset (Fair Value Hedge)This topic has 1 reply, 2 voices, and was last updated 4 years ago by Stephen Widberg.Viewing 2 posts - 1 through 2 (of 2 total)AuthorPosts February 25, 2021 at 2:23 pm #611674 wongyongshengwongParticipantTopics: 1Replies: 0☆Referring to BPP SBR Study Text Chapter 8 Illustration 11, on the topic of fair value hedging1 July 20X6 Joules sold 10,000 ounces in the futures market for $215 per ounce for delivery on 30 June 20X7.31 December 20X6 The futures price for 30 June 20X7 delivery was $198 per ounce.30 June 20X7 The trader sold the inventories and closed out the futures position at the then spot price of $190 per ounce.May I know that why it is increase in future contract asset (a gain) although the price of future keeps dropping? February 28, 2021 at 8:17 am #612060 Stephen WidbergKeymasterTopics: 16Replies: 3411☆☆☆☆☆You have agreed to sell for 215.The selling price (for everyone else drops to 190).So you are happy – it’s a gain.AuthorPostsViewing 2 posts - 1 through 2 (of 2 total)You must be logged in to reply to this topic.Log In Username: Password: Keep me signed in Log In