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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Futures Interest rates Mock 2 Q2 Autocrat
Dear Sir
I am noticing that the method of calculation using the deduction of the unexpired basis from the future sell (if borrowing) price works out the same whatever the amount the examiner says the spot rate is at the time of calculation
Fore example a(i) has an effective interest rate of 4.86%
Will this always be the case, even if examiners says the interest rate will be such and such in 7 months time?
It is always the case – it is the lock-in rate, and I explain about this in my lectures.