Question
1. The S&P 500 index is currently at $2,500. If we assume a continuously compounding interest rate of 1% and a continuously compounding dividend yield
1. The S&P 500 index is currently at $2,500. If we assume a continuously compounding interest rate of 1% and a continuously compounding dividend yield of 2%, what will be the fair forward price for the index at 4-year maturity? Round to integer.
2. You are long 300 contracts of 1-yr gold futures with a delivery price (K) of $1,200. What will be your payoff at expiry if the gold price at expiry (S_T) is $1100?
3. You are long 600 contracts of 2-yr put option on QQQ with a strike price (K) of $200. What will be your payoff at expiry if QQQ price at expiry (S_T) is $200?
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