Q13 please explain
Q13 please explain
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Q13 please explain
Q13 please explain
Read lessHello Sir/Friends – Can someone share Behavioural finance notes or schweser if possible. I have my L3 this month end and running short of time to watch Sir’s videos. Any help would be appreciated.
Hello Sir/Friends – Can someone share Behavioural finance notes or schweser if possible. I have my L3 this month end and running short of time to watch Sir’s videos. Any help would be appreciated.
Read lessI do get that the Assets held for sale must be valued at Fair Market Price. Can someone tell me what’s the difference in accounting treatement of such assets under USGAAP v/s IFRS?
I do get that the Assets held for sale must be valued at Fair Market Price. Can someone tell me what’s the difference in accounting treatement of such assets under USGAAP v/s IFRS?
Read lessAs per me answer of Q3 is C, we dont have enough information, but when sir take question solving class, he said answer is (b), to buy Put option. For Example, Share bought price is 500 Share Rises to 510 Put ...Read more
As per me answer of Q3 is C, we dont have enough information, but when sir take question solving class, he said answer is (b), to buy Put option.
For Example,
Share bought price is 500
Share Rises to 510
Put bought for 15 premium, then selling forward is much beneficial in comparison to Put buy, so as per me answer is “C” we dont have enough information.
For this question in the second part why does t = 3 instead of 4
For this question in the second part why does t = 3 instead of 4
Read lessI entered all data correctly in data function of the calculator and i applied the formula of sample variance which is summation of (x-xbar)^2/n-1. (44-11)^2/4-1 which is coming out to 363. p.s. answer mentioned in image is variance of x= 97.67 (0.9767) variance ...Read more
I entered all data correctly in data function of the calculator and i applied the formula of sample variance which is summation of (x-xbar)^2/n-1.
(44-11)^2/4-1 which is coming out to 363.
p.s. answer mentioned in image is variance of x= 97.67 (0.9767)
variance of y= 82.67 .
covariance -83.33
why my answer is coming out be wrong?
Read lessSusan Winslow manages bond funds denominated in US Dollars, Euros, and British Pounds. Each fund invests in sovereign bonds and related derivatives. Each fund can invest a portion of its assets outside its base currency market with or without hedging ...Read more
Susan Winslow manages bond funds denominated in US Dollars, Euros, and British Pounds. Each fund invests in sovereign bonds and related derivatives. Each fund can invest a portion of its assets outside its base currency market with or without hedging the currency exposure, but to date Winslow has not utilized this capacity. She believes she can also hedge bonds into currencies other than a portfolio’s base currency when she expects doing so will add value. However, the legal department has not yet confirmed this interpretation. If the lawyers disagree, Winslow will be limited to either unhedged positions or hedging into each portfolio’s base currency.
Given the historically low rates available in the US, Euro, and UK markets, Winslow has decided to look for inter-market opportunities. With that in mind, she gathered observations about such trades from various sources. Winslow’s notes with respect to carry trades include these statements:
Regarding inter-market trades in general her notes indicate:
Winslow thinks the Mexican and Greek markets may offer attractive opportunities to enhance returns. Yields in these markets are given in Exhibit 1, along with those for the base currencies of her portfolios. The Greek rates are for euro-denominated government bonds priced at par. In the other markets, the yields apply to par sovereign bonds as well as to the fixed side of swaps versus six-month Libor (i.e., swap spreads are zero in each market). The six-month Libor rates also represent the rates at which investors can borrow or lend in each currency. Winslow observes that the five-year Treasury-note and the five-year German government note are the cheapest to deliver against their respective futures contracts expiring in six months.
Exhibit 1
Sovereign Yields in Five Markets
Floating | Fixed Rate with Semi-annual Payments | |||||
6 Mo Libor | 1 Yr | 2 Yr | 3 Yr | 4 Yr | 5 Yr | |
Mexico | 7.10% | 7.15% | 7.20% | 7.25% | 7.25% | 7.25% |
Greece | — | 3.30% | 5.20% | 5.65% | 5.70% | 5.70% |
Euro | 0.15% | 0.25% | 0.30% | 0.40% | 0.50% | 0.60% |
UK | 0.50% | 0.70% | 0.80% | 0.95% | 1.00% | 1.10% |
US | 1.40% | 1.55% | 1.70% | 1.80% | 1.90% | 1.95% |
Winslow expects yields in the US, Euro, UK, and Greek markets to remain stable over the next six months. She expects Mexican yields to decline to 7.0% at all maturities. Meanwhile, she projects that the Mexican Peso will depreciate by 2% against the Euro, the US Dollar will depreciate by 1% against the Euro, and the British Pound will remain stable versus the Euro. Winslow believes bonds of the same maturity may be viewed as having the same duration for purposes of identifying the most attractive positions.
Based on these views, Winslow is considering three types of trades. First, she is looking at carry trades, with or without taking currency exposure, among her three base currency markets. Each such trade will involve extending duration (e.g., lend long/borrow short) in no more than one market. Second, assuming the legal department confirms her interpretation of permissible currency hedging, she wants to identify the most attractive five-year bond and currency exposure for each of her three portfolios from among the five markets shown in Exhibit 1. Third, she wants to identify the most attractive five-year bond and hedging decision for each portfolio if she is only allowed to hedge into the portfolio’s base currency.
Q. Which of Winslow’s statements about carry trades is correct?
Q. Which of Winslow’s statements about inter-market trades is incorrect?
Q. Among the carry trades available in the US, Euro, and UK markets, the highest expected return for the USD-denominated portfolio over the next 6 months is closest to:
Q. Considering only the US, UK, and Euro markets, the most attractive duration-neutral, currency-neutral carry trade could be implemented as:
Q. If Winslow is limited to unhedged positions or hedging into each portfolio’s base currency, she can obtain the highest expected returns by
Q. If Winslow is allowed to hedge into any of the currencies, she can obtain the highest expected returns by
Sanjay Sir, Can you please walk me through this item set. This came in practice question in student resources.
Read lessPls solve this
Pls solve this
Read lessHyderabad Finance Ltd. offers a deposit scheme where the investor is required to deposit Rs. 100 at the end of every month for a period of 4 years 2 months in order to get an amount of rs. 7500 at ...Read more
Hyderabad Finance Ltd. offers a deposit scheme where the investor is required to deposit Rs. 100 at the end of every month for a period of 4 years 2 months in order to get an amount of rs. 7500 at the end of 5 years. What is the effective rate of interest per annum?
Options:
a) 13.30 %
b) 14.30%
c) 14.61 %
The solution suggested in the Mock Test Solution was through CF (Cash Flow) mode in financial calculator, but the answer doesn’t match.
Read lessTopic 1/8: Forex PFA the Revision Audio in the answer section.