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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Unexpired basis
Hi, I am struglling to understand the apportionment for unexpired basis. Do you have a formula for the time fraction?
I understand that the basis narrows linearlly, but when trying Alecto Co they apportioned the basis as 2/6.
$22m in 4 months’ time on 1 May 20X2, expecting full repayment 9 months from now. Choose June futures.
My understanding for the numerator is 1 May – 30 Jun = 2 months unexpired
But why would the denominator be 6?
Thanks!
I can see this now; it’s the period from Now to the futures end date
Correct 🙂