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Calculating Futures Contract Gain or Loss

kelly441 said: "I am new to investing and I believe that the US dollar will continue to devalue and that gold and light crude oil will continue to go up. Based on these beliefs I would like to invest in these two commodities. I found this information on another website that explained pretty well how a futures contract works but there is some numbers here that I am not sure how they came up with. Here is their scenario: "As a result of leverage, if the price of the futures contract moves up even slightly, the profit gain will be large in comparison to the initial margin. However, if the price just inches downwards, that same high leverage will yield huge losses in comparison to the initial margin deposit. For example, say that in anticipation of a rise in stock prices across the board, you buy a futures contract with a margin deposit of $10,000, for an index currently standing at 1300. The value of the contract is worth $250 times the index (e.g. $250 x 1300 = $325,000), meaning that for every point gain or loss, $250 will be gained or lost. [U][B]QUESTION[/B][/U] Where did they come up with $250 being the value of a the contract? What is the value of a one light crude oil and the value of one gold futures contract? How do I figure this out? If after a couple of months, the index realized a gain of 5%, this would mean the index gained 65 points to stand at 1365. In terms of money, this would mean that you as an investor earned a profit of $16,250 (65 points x $250); a profit of 162%! On the other hand, if the index declined 5%, it would result in a monetary loss of $16,250 - a huge amount compared to the initial margin deposit made to obtain the contract. This means you still have to pay $6,250 out of your pocket to cover your losses. [FONT="Arial"][B][U]QUESTION[/U][/B][/FONT] If I know the value of the contract for oil and gold then I can use this same formula in this scenario to calculate potential gain or loss? The thing that seems the riskiest in futures are the margin calls. In a futures contract can you lose more then your margin? Is it possible that you would not only lose your margin but owe the leverage.In other words if my margin is $4000 and my leverage is $80,000, is it possible to owe $80,000 if the price of oil goes really low? I want to go LONG on one oil futures contract that should cost about $4000, but I want to know how many dollars and cents the price per barrel of oil would have to go to in order for me to pay a margin call? Based on current prices of gold and oil can someone do the math here for me LAST QUESTION It seems that every website that allows you to invest in Futures requires you to have over $25,000 equity and 3 years experience in stocks. Why are these companies so strict on who the let invest in Futures, why would they care if I blow $4000 on a futures contract? They still get their commission anyway. Is there a website that is reputable that lets you open a futures account with little hassle? Thanks, Kelly"