Futures and Forwards equations and questions Flashcards
Equation for gain/loss on futures
How do you find the balance of a margin account ??
When looking at daily balances of a margin account, whats the difference between a long and a short position
Long: If the price of the futures price the day before is less than today than you have made a profit, so margin account increases
Short: If the price of the futures price the day before is less than today than you have made a loss, so margin account decreases
For margin call, when do you use this and how do you work out how much ??
The starting margin account balance - margin account balance when it dips under the maintenance margin
How do you find the total gain or loss of your margin account ??
Profit or loss made from short selling
What do these notations mean ??
Whats the equation to find the Forward price ??
Whats the forward price ??
How do you find the forward price with a known dividend ??
Where is the PV of the income during the life of the forward contract
How do you find the PV of a dividend ??
Whats the equation for a forward price with a known yield ??
q = average yield per annum on an asset during its life of a forward contract
How do you find the expected dividend yield on an index ??
How do you derive the risk-free rate with no dividend ??
How do you find the risk free rate with a dividend ??
What is the terminal value of a long forward contract ??
What is the terminal value of a short forward contract ??
How do you find the risk free rate with a dividend yield instead of an actual number ?
