Someone please explain and show me the formula that you generally use to:
-
Transforming Nominal to Real rates, and vise versa?
-
Transforming RFRs to Ctn Cmp RFRs?
I cant seem to find them, and i know that this is fair game for the exam
Someone please explain and show me the formula that you generally use to:
Transforming Nominal to Real rates, and vise versa?
Transforming RFRs to Ctn Cmp RFRs?
I cant seem to find them, and i know that this is fair game for the exam
Real to Nominal & Nominal to Real
(1 + rnom) = (1 + rreal)(1 + inflation)
(1 + rreal) = (1 + rnom) / (1 + inflation)
Annual Continuously Compounded to Annual Effective & Annual Effective to Annual Continuously Compounded
1 + EAR = ercont
rcont = ln(1 + EAR)
the magician! thanks!