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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Estimation of futures price
From the lectures, the basis risk and the spot rate on the transaction date is used to estimate the futures price on the transaction date. Some questions do not give the spot rate on the transaction date (eg Lammer June 06) but the futures price is estimated by adding the basis risk to the current futures price. How do you know whether to add or subtract the basis risk with regards to the current futures price ?
