Question
An analyst for Bloom Ltd, gathered the following information with regards to futurescontract: *Current spot-market price of R60 *Risk-free interest rate of 8.87% per annum
An analyst for Bloom Ltd, gathered the following information with regards to futurescontract:
*Current spot-market price of R60
*Risk-free interest rate of 8.87% per annum
*The six-month future contract is priced at R62.60
Given that the actual futures price of the contract is R59, describe the strategy anarbitrageur could follow
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Personal Finance
Authors: Jeff Madura
5th edition
132994348, 978-0132994347
