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Hello sir in Futures we are not given the spot rate on the transaction date, sir what is the method to calculate the spot rate on the transaction date.
Also, I don’t understand how in the Model answer they derived the future price of the transaction date.The answer has calculated the ‘lock-in’ rate, which is the net effect of converting the transaction at spot together with the gain or loss on the futures.
This is the more likely situation in the exam these days, and I explain the lock-in rate and how to calculate it in my free lectures on foreign exchange risk management.
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