[rinku]

Thank John, but why have they used the same call and put price to give us 4.75% when clearly, the call option price needs to be higher to that of put option?

[rinku]

Hi John,

Thank you for the response. I understand the 100-95.250, but i thought an investor would buy a call option at a floor rate and would sell put at a cap rate.

Now my question is, if an investor would buy call at a floor rate and sell put at a cap rate, why as per the answer on the book we are setting the collar at a same put and call price?

Also, the part b(i) on the same question we find different alternatives to give us a minimum interest rate of 4.05% on the investment. Why haven’t we included a same call and put strike rate on part b(i) to give us more alternatives to choose from?

I hope i am making sense??

[rinku]

Oops.. Sorry John,

The name of the question is Collar Hedge in Kaplan(June 03 A). BPP has the same question under the name of Troder – Q.51 and it is part b(ii) that I am after.

[rinku]

@anoopej thank you for the answer 🙂

Thanks John for confirming.

[rinku]

can anyone remember the breakdown of question 2 please ?

[rinku]

oh yes, thank you for replying.. Btw how did you guys find it today?

[rinku]

what was 1b ?

[rinku]

Mike, thanks a lot for answering this question. I had this question but just didn’t get a chance to put it up here. Thanks again for the clarity!

And thanks to ag1214 for putting this question up. literally, you read my mind!

[rinku]

can you please add me too. My id – rin_s_k@yahoo.com. Thanks

[rinku]

Hi John,
Thanks a tonne, I knew it was as simple as that but somehow I read it as 45000 and not 450000. I did calculate the way you showed but saw the answer as 45000 and not 450000. I guess, i still got treassuary quesitons to do and that’s why may be have paniced a little!!

Sorry for this and thanks again!!

[rinku]

Hi John, yes that’s non-current assets – sorry about typing net assets..
And thanx for the response, i kinda figured it out after awhile 🙂 Thank you again!!

[rinku]

Hi,

This is me again.. I got the answer.. I was calculating tas of 30% instead of 33% and was confused as to why I wasn’t getting 201.

Thanks for reading 🙂

[rinku]

Hi
I’ve got 4 papers left to be an ACCA affiliate. I have 30 months of experience as an accountant in different industries as worked for an accounting firm and would love to work in the uk. I wonder if anyone here knows of any firm who recruits accountants from abroad.
Also, I lived in the uk for a bit and got back to india but now i want to go back to the uk – I am an Indian by nationality.

Any help would be highly appreciated,

Thanks in advance.

[rinku]

@zahidbd said:
so got 5 marks r8…thnx god

I too got the same answer – so it’s 6 so far 🙂

[rinku]

good one!!! loved it 🙂

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