A one-year forward contract of a share, which pays no dividend before the contract matures is...
A one-year forward contract of a share, which pays no dividend before the contract matures is written when the share has a price of $50 and the risk-free interest rate is 10% a year.
A. What is the forward price?
B. If the share is worth $55 six months later, what is the value of the original forward contract at this time? If another forward contract is to be written with the same date of maturity, what should the forward price be?
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A one-year forward contract of a share, which pays no dividend
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On 8/15/2019, a 3-year forward contract, expiring 8/15/2022, on a non-dividend-paying stock was entered into when...
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1. A 1 year long forward contract an a non-dividend paying stock is entered into when the stock price is $39 and the risk-free rate of interest is 6.5% per annum with continuous compounding (a) What is the forward price? (b) Six months later; the price of the stock is $42.50 and the risk-free interest rate is still 6.5%. What is the forward price?
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