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Wow!
I’m only realising that now.Lastly, Lisa: does this mean we should expect more than 15 questions in SEC A, for FM, in the live exam?
Please excuse my ignorance. As you’ve already said, “Section A consists of 15 short questions.” I don’t want any surprises regarding the exam structure, and additional marks (over 100) mean additional questions to me.That’s an invaluable piece of advice.
Thanks a lot, Lisa.
The concept is fully understood. 🙂Ok, Lisa.
Thank you.But just for certainty: If the forward rate is quoted at a premium, the SECOND currency is quoted against that appreciates?
Example 1:
Spot $/£ 1.5326 – 1.5385
3m forward 0.62 – 0.51 c pm
Here, the pounds (£) appreciatesExample 2:
Spot $/€ 1.5326 – 1.5385
3m forward 0.62 – 0.51 c pm
Here, the euro (€) appreciates.Oh!
Sorry for the misinterpretation of the question.And the interest yield is 8.7% (8/92)
So 9.5% > 8.7%Thanks.
Yes, Lisa.
It does help A LOT.
Thank you so much for your patience. 🙂One more question, though I’ve never seen this asked before:
Why would redemption be at a discount?According to the explanations of John Moffat in the lecture videos, he explained why redemption will be at a premium – which is very sensible and logical.
But why would debt lenders accept a lower than the par value at redemption?Thank you,
But does this mean that I should use the CUM DIV share price to calculate what the CONVERSION VALUE of the shares will be in n-years time?
Sorry I was unable to answer this earlier, Jill.
The exam was not bad, but I encountered some challenges due to subtle differences in the function of the spreadsheet.
The spreadsheet for the exam and the one provided for the CBE Practice Platform are not exactly the same.
But I’ve learnt my lesson.The question says “2021” but Aurora died in 2023, PLUS, the NRB referred to in the question is “NRB @ gift” to Aurora and “NRB @ Death” to her husband because he died in that year
I understand TX mainly due to your lectures. Please pardon my it-should-be-obvious questions
I understand that Jill, but it is not mentioned in the question.
The question only says: “On 30 April 2021, Tony had made a PET of £400,000 to his son.”Thank you.
However, I have no problem with the calculations; the wording was unclear.
But I think it is now.Question reference: Edwen Co; Section B; Risk Management; BPP Kit (2023)
“…so both are fundamentally annual rates that are adjusted for the specific duration of the transaction.”….. This is an excerpt from your reply.
I’m not sure of the correctness of your statement, Sir.
Similar wordings were used to solve a similar question in the BPP Kit, but it was NOT pro-rated in the BPP Kit because it already said, “3 months rates”I understand that one has to be for borrowing and the other, for depositing – that is not what I’m doubtful of.
Why is a similar wording used in BPP Kit but the treatments are different, Sir?