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June 2014

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › June 2014

  • This topic has 5 replies, 2 voices, and was last updated 9 years ago by John Moffat.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • November 19, 2016 at 1:45 pm #349986
    Muslim Farooque
    Member
    • Topics: 190
    • Replies: 134
    • ☆☆☆

    Hello Sir, i wanted to know that why did you not add subtract profit or loss in the futures contract scenario to advise, u took the payment on the open market based on the lock in rate but didnt add subtract the profit or loss

    November 19, 2016 at 5:50 pm #350038
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54833
    • ☆☆☆☆☆

    The lock in rate is the net result of converting at spot and dealing with the profit and loss.

    My free lecture on lock-in rates will help you with this.

    November 19, 2016 at 9:40 pm #350075
    Muslim Farooque
    Member
    • Topics: 190
    • Replies: 134
    • ☆☆☆

    ill check it out sir surely, but sir i didnt see that in options either , checking out what happens in open market

    November 20, 2016 at 7:49 am #350114
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54833
    • ☆☆☆☆☆

    Lock-in rates are not relevant with options – they only apply when you are dealing in futures.

    November 20, 2016 at 5:52 pm #350185
    Muslim Farooque
    Member
    • Topics: 190
    • Replies: 134
    • ☆☆☆

    oh right , so if we did an exact spot rate at the exercise date as we cannot use lock-ins for options , we could have seen what would have been the result at the open market,

    thanks alot

    November 20, 2016 at 6:03 pm #350192
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54833
    • ☆☆☆☆☆

    That is true 🙂

  • Author
    Posts
Viewing 6 posts - 1 through 6 (of 6 total)
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