Order Grade A+ Academic Papers Instantly!

An off-market forward contract

An off-market forward contract is a forward where either you have to pay a premium or you receive a premium for entering into the contract. (With a standard forward contract, the premium is zero.) Suppose the effective annual interest rate is 10% and the S&R index is 1000. Consider 1-year forward contracts.
a. Verify that if the forward price is $1100, the profit diagrams for the index and the 1-year forward are the same.
b. Suppose you are offered a long forward contract at a forward price of $1200.
How much would you need to be paid to enter into this contract?
c. Suppose you are offered a long forward contract at $1000. What would you be willing to pay to enter into this forward contract?


15% off for this assignment.

Our Prices Start at $11.99. As Our First Client, Use Coupon Code GET15 to claim 15% Discount This Month!!

Why US?

100% Confidentiality

Information about customers is confidential and never disclosed to third parties.

Timely Delivery

No missed deadlines – 97% of assignments are completed in time.

Original Writing

We complete all papers from scratch. You can get a plagiarism report.

Money Back

If you are convinced that our writer has not followed your requirements, feel free to ask for a refund.