Question
Suppose that the initial margin requirement is 20%. Suppose you buy a 2-year forward contract for jet fuel today with a forward price of 100
Suppose that the initial margin requirement is 20%. Suppose you buy a 2-year forward contract for jet fuel today with a forward price of 100 USD per barrel. By how much can the spot price of jet fuel fall in one year before your margin runs out? The 1-year, annually-compounded risk-free rate is 1%.
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Real Estate Finance And Investments
Authors: William Brueggeman, Jeffrey Fisher
16th Edition
1259919684, 978-1259919688
