plz solve this sum ???
QUS: You are given the following information by your BANKER :
SPOT RATE (Rs./Can $) : 25.00/26.00
Rupee Interest Rate (6 months) : 14.00/16.00
Can $ Interest Rate (6 months) : 9.00/11.00
DETERMINE THE LIMITS FOR SIX MONTH FORWARD RATES.
Here i m giving solution as per my opinion -
Fwd. rate for bid side -=25 * (1+{14*6/12}) / (1+{11*6/12})
=25(1.07/1.055)
=25.3555
Fwd. rate for ask side = 26 * (1+{16*6/12}) / (1+{9*6/12})
= 26(1.08/1.045)
= 26.8708
Thus fwd quote would be 25.3555/26.8708
If you have answer for the question then plz. verify the solution.
Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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CAclubindia
