Identifier: C3T1L2 · Revision: 2026-10-26 · Classification: domestic

Decision and objectives

Calculate ticks and notional exposure in matching units. The decision record must connect the exposure, cash dates and implementable contract, rather than stop at a favorable price forecast.

By the end, you can calculate ticks and notional exposure in matching units; reconcile long and short realized profit after explicit costs; separate collateral return from trading return.

Prerequisite: C3T1L1; completed Classes 1 and 2 and the Stock Market School foundation or Forex School foundation. All cases below are hypothetical; their prices, costs, rates, dates, contractual assumptions and collateral amounts are teaching inputs, not current offers.

Mechanics

An offsetting trade in the same series reduces or closes the position. For a linear contract, cumulative daily settlement and the final closing adjustment reconcile to the price difference times the signed quantity. Positive signed quantity means long, negative means short. Returning collateral is not revenue: it releases an existing asset. A separately financed collateral balance has its own cost.

Price and return drivers

Gross profit = signed contracts × multiplier × (exit − entry). Net trading profit deducts execution charges once. Funding belongs in an additional cash line. A return computed on deposited collateral describes account leverage; it is not the same as the price return of the underlying or an unlevered investment return.

Worked case

Two hypothetical long cash-settled index futures enter at 10,000 and exit at 10,200; multiplier TRY 10, tick 1 point. Notional is TRY 200,000. The move is 200 ticks, giving 2 × 10 × 200 = TRY 4,000 gross. Total round-trip commission is TRY 40; net before funding and tax is TRY 3,960. If TRY 30,000 collateral is financed for ten days at simple 36% on actual/360, financing is 30,000 × 0.36 × 10/360 = TRY 300; economic result is TRY 3,660. The hypothetical charges include execution spread in the supplied fills, so do not subtract it again.

Adverse case

An exit at 9,700 gives 2 × 10 × (9,700 − 10,000) = −TRY 6,000 gross; after TRY 40 commission and TRY 300 funding the result is −TRY 6,340. A short two-contract position has +TRY 6,000 gross on that same decline, not the same loss. If a short rises to 12,000, gross loss is TRY 40,000, exceeding the illustrative TRY 30,000 collateral. No finite upside price caps the short's contractual loss.

Practical use

Obtain transaction prices and charges from the confirmation, then reconcile each settlement posting to the closed result. An indicative screen mid is unsuitable as both entry and exit. Class calculations deliberately use hypothetical fills rather than claim current liquidity. Brokerage, clearing, collateral interest, tax and currency conversion can be posted on different statement dates.

Reconcile the confirmation, position register and cash statement separately. Costs include the quoted bid/ask spread, brokerage and clearing charges, collateral or principal financing, currency conversion, custody where relevant, and exit or termination charges. A mark is not a fill. Any amount explicitly excluded below remains outside the reported result. Tax is excluded from these teaching cases: an actual comparison requires income year, investor residence and individual/corporate status, contract and acquisition dates, settlement form and effective law. The GIB guide, checked 2026-10-26, covers 2025 individual investment income, so its publication date alone does not settle a 2026 derivative liability.

Decision boundaries

Use this calculation to audit a linear trade; do not apply it directly to option premiums or a physically delivered principal obligation. If the intended exposure is fully funded ownership without calls, depositing less collateral does not create an equivalent cash plan. Decline leverage whose stress debit cannot be financed.

Practice and references

Exercise: three hypothetical short contracts, multiplier TRY 5, entry 8,000, exit 7,850, total fees TRY 75 and funding TRY 100. Solution: −3 × 5 × (7,850 − 8,000) = TRY 2,250 gross; 2,250 − 75 − 100 = TRY 2,075 net before tax. The exposure reference at entry is 3 × 5 × 8,000 = TRY 120,000, not the profit denominator unless explicitly chosen.

Takeaway: Separate collateral return from trading return using the actual cash schedule, with every excluded cost and remaining exposure stated.

Reference card: viop-future. Formula: Linear futures net result. Glossary: Notional, Variation settlement. Next lesson: C3T1L3. Topic test.

Sources and verification date (2026-10-26):

Related product cards: viop-index-future.

Additional formulas: notional-exposure.

Shared reference guide