I believe the numerator is correct, i.e. using the 90 days LIBOR spot. I don’t understand why they are using the 150 days spot. its a 2x5 FRA… it should be: [(1+90 days LIBOR) / (1+60 days LIBOR)] - 1 is there something im missing here?

no it should be (1+150 days LIBOR) / (1+60 days LIBOR) ] - 1 You want to enter an FRA 2 months from now (60 days) The FRA will be on a 3 month loan (90 days) The easiest way to remember it. Denominator Rate to be used - When the FRA will begin Numberator Rate to be used - Denominator Rate + Underlying Loan Term Rate So in this case Denominator Rate = 60 day LIBOR (that’s when your loan will start effectively) Numerator Rate = 60 day LIBOR + 90 day LIBOR = 150 day LIBOR Rate this is how i remember it…dunno if it works for you…

got it. thanks.