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Good day Sir,
A little on how the predicted future rate of 1.5353 was calculated.
Using the lock in rate method this is what am getting;
1.5350(December futures)-(1.5350-1.5275)*1/3=1.5325
To get the lock in rate, you first calculate the current basis as the difference between the current spot rate of 1.5510 and the current December futures price of 1.5275, which is 0.0235.
You then take the current spot rate and subtract the expired basis, which gives
1.5510 – (2/3 x 0.0235) = 1.5353
Alternatively you take the current future price and add the unexpired basis, which gives
1.5275 + (1/3 x 0.0235) = 1.5353.I do suggest that you watch my free lectures on this.
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