CFAI Reading #38, Page 144, Example 1

For those who have gone through the SWAP, CFAI Reading #38, Page 144, Example 1, how is the forward exchange rate calculated? Thanks.

Details for those of us without the book? But the answer is surely using interest rate parity.

Dude, just in case you didn’t notice… that entire section is an optional reading (not tested).

McLeod81, in all seriousness, how did you know that this is an optional reading?

There are long bars down the side of each page with a small icon which says “optional segment” and has a book with a ( \ ) through it. Not to say that you can’t read the section for background knowledge, but I’m not going to. That section is all review from L2.

Good catch, thanks a lot.

WTF is optional reading anyway? www.amazon.com contains lots of optional reading. Is there some CFAI restricted reading that I don’t know about? (since I would surely buy it).

JoeyDVivre Wrote: ------------------------------------------------------- > WTF is optional reading anyway? www.amazon.com > contains lots of optional reading. Is there some > CFAI restricted reading that I don’t know about? > (since I would surely buy it). It’s reading that included in the curriculum (those element books) but will not be tested on the exam. I found that they tend to be fundamentals with the actual material being tested built further from these concepts.

restricted readings include anything that challenges the notion of efficient frontiers or stationary correlations. I think the Harry Potter series is on the black list also