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Hi Sir
1. if e.g. $/£ rate = x , does £/$ rate = 1/(x) ?
2. in my revision kit, FRA’s are quoted like this: FRA 3v9… or FRA 3v4…. Is this format not used in the exam anymore? And what does the second number mean?
3. in my revision kit, it showed that if the spot in 3 months was less than the FRA, the bank paid the company the difference, but if it was above, the company had to pay the bank the difference. is this still valid for the exam?
Thank you in advance for your kind help.
1. Yes
2. Yes, that format is still used and I explain it in my lectures (FRA 3v9 is and FRA for a loan starting in 3 months time and finishing in 9 months time.
3. Yes, and again I explain this in my lectures!Hi Sir.
Thank you.
Honestly, I wrote these questions immediately after rewatching the lecture.
I don’t know if my attention is poor, but the FRA ‘v’ format was not mentioned (another format was), nor was any pay back of the difference in actual to the FRA.
I apologise if they were.
Hi Sir, my apologies.
You do indeed explain this in the INTEREST RATE FRA lecture, where is applies.
I wrote the first post after watching the Currency FRA lecture, where the above does not apply.
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