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Forums › ACCA Forums › ACCA FM Financial Management Forums › cap and flooring
sir, I do not understand the need for capping in an option. I already have a fixed interest rate say 8% and I am the borrower. if the interest rate increases I exercise my right and if the interest rate goes down then I don’t exercise. what does a cap do then? I have watched your lecture but this part was a little confusing for me.
