I am super confused about the wording of the sentence " (2) entering into a one-year forward contract to purchase a one-year zero-coupon bond for DF 1 = 0.95.*" in the explanation below. While I understand the concept of the forward pricing model, this sentence does not any make sense to me, what does it mean?*

Full excerpt below:

The forward pricing model describes the valuation of forward contracts.

π·πΉπ΅=π·πΉπ΄ΓπΉπ΄,π΅βπ΄

The discount factors DFA and DFB represent the respective prices for period A and a longer period B needed to derive the forward price, FA,BβA, a contract which starts in the future at time A and ends at time B.To understand the reasoning behind [Equation 2], consider two alternative investments: (1) buying a two-year zero-coupon bond at a cost of DF 2 = 0.93 and (2) entering into a one-year forward contract to purchase a one-year zero-coupon bond for DF 1 = 0.95.* Because the payoffs in two years are the same and the initial costs of the investments must be equal, the no-arbitrage forward price F 1,1 must equal 0.93/0.95, or 0.9789.*

thank you but how can βYear 1 purchase the 1-year zero for DF 1 = 0.95β be true? DF1 is the price of 1 year zero at time 0, not time 1? That is what is messing with my head

I get that part, I totally understand what the first alternative investment is since that is purchasing a 2 year zero at DF2, a known price at 0.93.

But for the second alternative, I do not understand what it means to purchase a 1-year zero for 0.95 at year 1, when it should be purchase the 1 year forward at the agreed upon forward price? I guess I am super confused what the right hand side of the equationβs alternative investment really is, π·πΉπ΅=π·πΉπ΄ΓπΉπ΄,π΅βπ΄.

Does DF1 mean something different? I thought it is equivalent to price of 1 year forward at time 0.