C?
Here’s another one while we’re waiting. It must be getting late as this seems real simple. Regarding futures contracts, the spot price refers to the: A) price of the underlying asset in a particular location, or ‘spot’, in the future. B) current market price of the asset underlying the futures contract. C) present value of the expected future price. D) contract price of the asset at any point in time.
b
P 213 “From a technical standpoint, the differences between the theoretical (no-arbitage) prices of futures and frwards center on the correlation between interest rates and the mark-to-market cash flows of futures.” Looks like we all got schooled by this one. So the answer would be B on this one.
cfaboston, i take that as a tap out if we were a WWF boston tag team. i think it is about time to throw in the towel for tonight. i friggin learned how to do swaps tonight- this is huge. this one i want to say is B. after studying for 8+ hours or whatever today though, who knows, even the easy stuff i start to question myself on.
C
thepinkman Wrote: ------------------------------------------------------- > Here’s another one while we’re waiting. It must > be getting late as this seems real simple. > > Regarding futures contracts, the spot price refers > to the: > > A) price of the underlying asset in a particular > location, or ‘spot’, in the future. > > B) current market price of the asset underlying > the futures contract. > > C) present value of the expected future price. > > D) contract price of the asset at any point in > time. B for this one I hope?
I am out. Just started Dervs today and went all the way through the Schweser. Going to finish up tomorrow. Thanks everyone.
what are the answers of last 2 questions, pinky?
I’ve got another (made this one up): Which of these is not a factor in the interest rate on an FRA? A) Credit worthiness of the long position B) Time to expiration of the contract C) Length of maturity of the underlying loan D) Current LIBOR
thepinkman Wrote: ------------------------------------------------------- > OK Dwight…riddle me this. > > he theoretical question of whether futures prices > are unbiased predictors of future spot rates > focuses on: > > A) whether futures buyers are taking on asset > owners’ price risk. > > B) the correlation between interest rate changes > and asset price changes. > A is the answer > C) whether futures markets are efficient. > > D) the relation between asset cash flows and the > risk-free rate of interest.
thepinkman Wrote: ------------------------------------------------------- > Here’s another one while we’re waiting. It must > be getting late as this seems real simple. > > Regarding futures contracts, the spot price refers > to the: > > A) price of the underlying asset in a particular > location, or ‘spot’, in the future. > > B) current market price of the asset underlying > the futures contract. > B > C) present value of the expected future price. > > D) contract price of the asset at any point in > time.
thepinkman Wrote: ------------------------------------------------------- > I am out. Just started Dervs today and went all > the way through the Schweser. Going to finish up > tomorrow. Thanks everyone. Exact same for me. Thanks everyone.
Dwight Wrote: ------------------------------------------------------- > I’ve got another (made this one up): > > Which of these is not a factor in the interest > rate on an FRA? > > A) Credit worthiness of the long position > > B) Time to expiration of the contract > > C) Length of maturity of the underlying loan > > D) Current LIBOR C
Dwight Wrote: ------------------------------------------------------- > I’ve got another (made this one up): > > Which of these is not a factor in the interest > rate on an FRA? > > A) Credit worthiness of the long position > > B) Time to expiration of the contract > > C) Length of maturity of the underlying loan > > D) Current LIBOR A?
D yes? isn’t it always one back that you use for the rate? i need to review futures and FRA’s bigtime after this long thread- i haven’t given much time and love to futures SS16 yet, more a struggle with SS17. i think SS16 should be easier, will review it manana. i’m out. thanks all for the help tonight- this seriously was a solid night of studying online.
thepinkman Wrote: ------------------------------------------------------- > thepinkman Wrote: > -------------------------------------------------- > ----- > > OK Dwight…riddle me this. > > > > he theoretical question of whether futures > prices > > are unbiased predictors of future spot rates > > focuses on: > > > > A) whether futures buyers are taking on asset > > owners’ price risk. > > > > B) the correlation between interest rate > changes > > and asset price changes. > > > > A is the answer > > C) whether futures markets are efficient. > > > > D) the relation between asset cash flows and > the > > risk-free rate of interest. I thought A was the answer at first but that is not what Schweser says: P 213 “From a technical standpoint, the differences between the theoretical (no-arbitage) prices of futures and forwards center on the correlation between interest rates and the mark-to-market cash flows of futures.” So the answer would be B.
thepinkman Wrote: ------------------------------------------------------- > Dwight Wrote: > -------------------------------------------------- > ----- > > I’ve got another (made this one up): > > > > Which of these is not a factor in the interest > > rate on an FRA? > > > > A) Credit worthiness of the long position > > > > B) Time to expiration of the contract > > > > C) Length of maturity of the underlying loan > > > > D) Current LIBOR > > > A? Nice Pink! Good on to go out on. P196 Schweser “and FRA is settled in cash, so there is no requirement to lend or borrow the amount stated in the contract. For this reason the creditworthiness of the long position is not a factor in the interest rate on the FRA”
bannisja Wrote: ------------------------------------------------------- > D yes? isn’t it always one back that you use for > the rate? i need to review futures and FRA’s > bigtime after this long thread- i haven’t given > much time and love to futures SS16 yet, more a > struggle with SS17. i think SS16 should be > easier, will review it manana. > > i’m out. thanks all for the help tonight- this > seriously was a solid night of studying online. You are right. What is the answer anyway pinky
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