Hi All,
Referring to Page 104 example (See attached for details.
In the solution I am not able to understand, in the receiving cash flow why will we receive $2 (Which is semi annual interest) after 3 month and similarly the outgoing cashflow is after 3 months (Why?)...
Thanks for your response Shakti. Probably I am lacking understanding here. Once a forward price is decided in a contract, does it change on a regular basis? and if yes, then how and what are the factors drive it.
Thanks in advance.
Idcnik01
Hi,
Can someone help explain this term.
"As the Futures contract approaches maturity, the spot price should converge with the
Futures price"
Sorry I do not find much explanation in the the Notes. I am not clear how the Spot price of a commodity will converge as per Future Price.
Thanks in...
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