90 days Given the following exchange rates and interest rates‚ what transaction exposure hedging strategy is now in Dayton’s best interest? Spot rate $1.7620/£ Expected spot rate in 90 days $1.7850/£ 90-day forward rate $1.7550/£ 90-day dollar deposit rate 6.0% p.a. 90-day dollar borrowing rate 8.0% p.a. 90-day pound deposit rate 8.0% p.a. 90-day pound borrowing rate 14.0% p.a. Dayton’s WACC 12.0% p.a.
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prices of traded securities. For example‚ stock option. Futures and Options ⇒⇒⇒⇒⇒⇒ actively traded on the many different exchanges. Forward Contracts‚ Swaps ⇒⇒⇒⇒⇒ traded outside of exchanges by financial Institutions and and other derivatives ⇒⇒⇒⇒⇒ their corporate clients ⇔ over-the-counter markets. FORWARD CONTRACTS: A forward contract is an agreement between to buy or sell an asset at a certain future time for a certain price. The contract is usually between two financial institutions or between
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Curriculum • Reading 60: Derivative Markets and Instruments • Reading 61: Forward Markets and Contracts • Reading 62: Future Markets and Contracts Expect around 6 questions in the exam from today’s lecture © Neev Knowledge Management – Pristine 2 www.edupristine.com Key Concepts • Difference Between OTC And Exchange Traded Contracts • Payoffs of Futures and Forwards • FRA‘s • Margins • Types of Futures © Neev Knowledge Management – Pristine 3 www.edupristine.com Introduction
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term that refers to a wide variety of financial instruments or “contract whose value is derived from the performance of underlying market factors‚ such as market securities‚ interest rates‚ currency exchange rates and commodity‚ credit and equity prices. Derivatives generally involve an agreement between two parties to exchange a standard quantity of an asset or cash flow at a predetermined price and at a specified date in the future. The derivatives markets are the financial markets for derivatives
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Acknowledgment A project is never the sole product of a person whose name has appeared on the cover. Even the best effort may not prove successful without proper guidance. For a best project one needs proper time‚ energy‚ efforts‚ patience‚ and knowledge and how to use all these things. But without any guidance it remains unsuccessful. I have done this project with the best of my ability and hope that it will serve its purpose. At the onset I would like to express my deepest gratitude to
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. . . . . . . . . . . . . . . . . . . . . . . . 19 5 Derivatives in the Indian Context: Some Comments 20 6 Regulation and its Challenges 26 A Derivatives Instruments 30 A.1 Forwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 A.2 Futures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 A.3 Swaps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 A.4 Options .
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Test Details Sr. No. Name of Module Fees (Rs.) Test Duration (in minutes) No. of Questions Maximum Marks Pass Marks (%) Certificate Validity (in years) 1 Financial Markets: A Beginners’ Module 1500 120 60 100 50 5 2 Mutual Funds : A Beginners’ Module 1500 120 60 100 50 5 3 Currency Derivatives: A Beginner’s Module 1500 120 60 100 50 5 4 Equity Derivatives: A Beginner’s Module 1500
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Trading. 1) Other than price & quantity there are three common characteristics of any contract. Identify each of these three and discuss their relevance to valuation of commodities. Form: What exactly is being delivered‚ Cost of transformation: taking one form and transforming to another form. Riskless trade capturing the full cost of transformation. Space: Location for delivery of the contract‚ driver is the cost of transporting an asset from one point to another. Riskless trade is buying
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0507/£ and the three-month forward rate is $2.0753/£. You enter into a short position on £120‚000. At maturity‚ the spot exchange rate is $2.0919/£. How much have you made or lost? 8. The current spot exchange rate is $2.0507/£ and the three-month forward rate is $2.0753/£. You enter into a long position on £120‚000. At maturity‚ the spot exchange rate is $2.0919/£. How much have you made or lost? 9. The current spot exchange rate is $1.7261/£ and the three-month forward rate is $1.7779/£. You enter
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A PROJECT REPORT ON “STUDY OF COMMODITY MARKET” For Marwadi Shares & Finance Ltd. SUBMITTED TO PUNE UNIVERSITY IN PARTIAL FULFILLMENT OF 2 YEARS FULL TIME COURSE MANAGEMENT OF BUSINESS ADMINISTRATION (MBA) Submitted By: ROHIT PARMAR (Batch 2006-08) Guided By:Prof. MAHESH HALALE BRACT’s Vishwakarma Institute of Management‚ Kondhwa Pune- 411014 1 ACKNOWLEDGEMENT It is great pleasure for me to acknowledge the kind of help and guidance received to me during my project work. I
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