Simple Swap Problem

dimanche 22 février 2015

Sorry to post this for you all, but my ACTEX manual doesn't give a very good explanation.








Quote:








Quarter 1 2 3 4

Oil Forward Price 21 21.2 20.9 20.7

Zero-Coupon Bond Price .985 .971 .954 .933



Suppose the forward oil price increases immediately by 1 for each of the four quarters, but the zero-coupon bond values are unchanged.



What is the market value of a four quarter oil swap?








Simple Swap Problem

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