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Dear respected Sir/Miss,
I am giving paper p4 this dec2014 attempt and am prepared with almost all of the syllabus except for these interest collars and caps .. i just cannot understand the calculations and having problems calculating them in BPP Kit Pilot Question Named as Alecto and other named as FNDC… plz help me out with how should be collars calculated. MUCH APPRECIATED.The following short article may help you:
ok sir i did understand the concept behind this COLLARS , But i just am having problem with the Calculation Collars in this Alecto Question ,,, please help me with it .
Because you are borrowing, you will buy a put option to limit the maximum rate. To create the collar we will sell a call option to fix a minimum rate.
With regard to the calculation, you are going to have to tell me which part of the answer is giving you the problem and then I will try and help.Ok Sir , thanks for ur concerns , i am done with the Calculations . Could you please tell me what so i need to do for the theoratical parts of the paper ? I am almost done with the Calc practice. So what Topics should a person go through in Theoratical Terms ?
And my second question is that i have been through the Kit , what i have felt that even though i practices the kit but still there are always things being asked in paper that i just find myself struggling , for example in last june 2014 attempt the examiner asked how duration could help calc the sensitivity of interests ? now what as a student shld i do so that i dun find the paper unusuall ?The only way to learn for the written parts of questions (other than reading every page of your Study Text, which would take for ever!) is to spend time learning from the written parts of past exam questions.
The more the better, but the best ones are those set by the current examiners (i.e. June 2010 onwards).
Also, look to see whether they are compulsory questions or choice questions, and how many marks were given for the written parts. Most important are those that were higher marks and those that were compulsory.Sir i want to do VAR .. cluld u please send me the link or ur article/lectures link ? Where i can learn the topic .. because in kaplan 2015 version text its just nt makin me comfortable doin the questions practically.
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