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      • Thanks. Could please confirm that the notes provided by opentuition is siffiecent enough material for the exam, providing we have read all the notes and listened to the lectures, and done the revision questions. thanks

      • Yes, subject to what you mean by the revision questions. You must have a Revision Kit from one of the ACCA approved publishers and have worked through every question – practice is vital both to checking your knowledge and to get used to the style of the examiner.
        Also, it is worth reading through the technical articles on the ACCA website – certainly the most recent ten of them (but the more the better).

      • I just didnt want to go waste time reading losts of study material from different providers, i’d rather use the notes & lectures on open tuition and then spend time working throught past papers. As long as we understand the material you have covered the examiner can not question us on other bits correct? thanks

      • Correct, although he really does test your understanding deeply. When you have finished studying you really must practice every question in your Revision Kit.

  4. I understood how A’s swap arrangement will work with the bank:

    A will pay 10% and receive 9.25% from the bank effectively making the same saving of 0.75%

    However, the B’s arrangement is confusing me.

    B will pay 1.5% and then pay additional 9.25% to effectively get the percentage he/she wanted (i.e- 10.75%), so what is B actually receiving from the bank then?

    It is L, but I am a bit confused. Can you also tell what is the L rate here in this question?

    • Without swapping, A would have paid interest of 10%. With swapping they end up paying a net 9.25%. So a saving of 0.75%

      Without swapping, B would have paid LIBOR + 6.5%. With swapping they end up paying a net LIBOR + 5.75%. So again a saving of 0.75%

      L is LIBOR which changes from day to day – so B is paying floating rate interest whereas A is paying fixed interest.

  7. I saw your lecture but I can’t calculate the effective interest rate of 5.34%, 5.08%, 4.36% and 4.60% in December 2014 question no. 2 keshi Co? Please can you calculate this for me?

  9. i scoured youtube and no luck.

    18 minutes of this lecture and i was able to do example 2 on my own. John is one of the few tutors who knows how to transfer the “intuitive” process of the transactions!

  11. Kindly Help me

    How to arrange this SWAP with your method.I am not understanding examiner method. CMC co June 2014 Question.

    Fixed Rates Floating Rates

    2.2% Yield + .4%

    3.8% Yield + .8%

    Bank Fee = 20 Basis points

  14. dear John,

    I have seen you give only where one party pays the other but I have not seen you say what the other party too pays out eg.. A pays 2 and b receives 2, b pays 3 and a receives 3

  15. @ Sir John, Thank you for this amazing lecture.
    I want to ask that how bank gain benefit from this swap? does it make profit by charging swap fee?
    Also can you please do a lecture on Collar, caps and floors.
    Thanks.

    • The lecture is working fine, so I don’t know what is causing your problem.

      Please go to the support page (the link is below the lecture) and if you do not find an answer there, then ask on that page and admin will try and help you.

      • It is in the free Lecture Notes. Our lectures form a complete classroom course, and they all use our free Lecture Notes!
        The link to download the notes is immediately above the lecture.

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