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swaps

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › swaps

  • This topic has 7 replies, 2 voices, and was last updated 4 months ago by John Moffat.
Viewing 8 posts - 1 through 8 (of 8 total)
  • Author
    Posts
  • February 22, 2022 at 4:39 pm #649123
    meeruraj
    • Topics: 25
    • Replies: 19
    • ☆

    in ur exmples u have given which rate the company is using now in exams we arent provided with that info so we do assume that the company is using fixed rate and would like to hedge against floating rate

    February 22, 2022 at 6:55 pm #649135
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49600
    • ☆☆☆☆☆

    Most questions make it clear by implication in the wording. However even if it is not made clear in the wording (which is very unusual) then a swap can only make a benefit one way round and it does not take long to work out which way round it will have to be.

    February 23, 2022 at 2:48 am #649152
    meeruraj
    • Topics: 25
    • Replies: 19
    • ☆

    in Q44 where have they stated it is being used fixed rate
    And should the amount we add / Deduct to equal it to the end result has to be same

    In Q39) the benefit of 0.2 will be get when we borrow at floating and then swap to fixed but in the ans it says the other way round

    February 23, 2022 at 11:44 am #649192
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49600
    • ☆☆☆☆☆

    I do now know which book you are referring to when you stated the numbers of the questions.

    February 24, 2022 at 2:33 am #649231
    meeruraj
    • Topics: 25
    • Replies: 19
    • ☆

    these question are from BPP

    February 24, 2022 at 11:18 am #649265
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49600
    • ☆☆☆☆☆

    I have been abroad on vacation for a week and I do not have the Revision Kits with me. I will be home tomorrow, so please ask again tomorrow and then I will be able to help you.

    February 25, 2022 at 3:34 pm #649341
    meeruraj
    • Topics: 25
    • Replies: 19
    • ☆

    sorry for disturbing u
    hope u had a great vacation and hope u r back home

    February 26, 2022 at 11:20 am #649380
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49600
    • ☆☆☆☆☆

    No problem 🙂

    You can find a full explanation of the swap in Q44 here:

    https://opentuition.com/topic/keshi-co-1214-part-a-swap/

    For Q39, I am a bit puzzled because in the current edition of the BPP Kit there is no swap in this question.

  • Author
    Posts
Viewing 8 posts - 1 through 8 (of 8 total)
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