Forward price on one year contract on portfolio tracking

Assignment Help Financial Management
Reference no: EM131464203

What is the forward price on a 1-year contract on a portfolio tracking the NASDAQ composite index, assuming the current value of the index is 5850.61, the 1-year risk interest rate is 0.75%, and the average yield (assumed to be continuous) on the NASDAQ composite dividend index is 0.93%.

Reference no: EM131464203

Questions Cloud

The value of an investment comes from its cash flows : The value of an investment comes from its cash flows. What interest rate is required to make this happen?
What lump sum deposited today : What lump sum deposited today at 8?% compounded quarterly for 5 years will yield the same final amount as deposits of ?$6000 at the end of each? 6-month period
The storage cost for coal is essentially zero : A 3-month contract on coal, assuming the current price of coal is $43.83 per short ton, the storage cost for coal is essentially zero
Financial statements for publicly traded company : Can you find the financial statements for a publicly traded company, and examine its statement of cash flows?
Forward price on one year contract on portfolio tracking : What is the forward price on a 1-year contract on a portfolio tracking the NASDAQ composite index,
What is the yield to maturity on each one : Ashly is considering the purchase of two bonds, each of which has a face value of $1,000. What is the yield to maturity on each one?
Prepare the budgeted multiple-step income statement : Cook Farm Supply Company manufactures and sells a pesticide called Snare. Prepare the budgeted multiple-step income statement for the first 6 months.
Firm desiring to enter into derivative contract frequently : A firm desiring to enter into a derivative contract frequently has a choice of two markets, a derivative exchange
What is break-even point in unit sales and in dollar sales : What is the break-even point in unit sales and in dollar sales? What is the break-even point in unit sales and in dollar sales?

Reviews

Write a Review

Financial Management Questions & Answers

  Asset allocation affects the investor return

Asset allocation affects the investor's return by: Select one: a. altering the returns on individual assets. b. weighting the portfolio return by the allocation. c. assuring diversification. d. increasing the investor's use of mutual funds.

  Implied personal tax rate on debt income

Assume that the firm's gain from leverage according to the Miller model is $126,667. If the effective personal tax rate on stock income is TS = 20%, what is the implied personal tax rate on debt income? If the following is true:

  Expected dividend and capital gains yields

Taussig Technologies Corporation (TTC) has been growing at a rate of 20% per year in recent years. This same growth rate is expected to last for another 2 years, then decline to gn= 6%. a) If D0= $1.60 and rs= 10%, what is TTC's stock worth today? Wh..

  How you could make an arbitrage profit

You are working as a corporate treasurer and observe the following two exchange rates. Calculate, using $1 million how you could make an arbitrage (risk-free) profit.

  What is the current stock price

A call option is currently selling for $6.40. It has a strike price of $55 and six months to maturity. A put option with the same strike price sells for $7.40. The risk-free rate is 5.3 percent, and the stock will pay a dividend of $2.70 in three mon..

  Buyer or seller with which to do business

When an underwriter of an IPO is willing to act as a buyer or seller of the stock, to ensure investors have at least one buyer or seller with which to do business, the underwriter is said to be

  Firm is considering new product development

Your firm is considering a new product development. An outlay of $110,000 is required for equipment, and additional net working capital of $5,000 is required. Implementing the project will generate a time zero investment tax credit benefit of $3,000 ..

  The necessary tools to monitor project progress

Project Networking provides the necessary tools to monitor project progress. Considerable time and effort is expended developing successful project networks. Compute the project network sequence and proper timing to complete the project using an exce..

  What is the current value of vandells stock

What is the current value of Vandell's stock and what profit or loss would Security Brokers incur if the issue were sold to the public at the following average price?

  Estimate value of an asset expected to provide cash inflows

Laura Drake wishes to estimate the value of an asset expected to provide cash inflows of $1,400 per year at the end of years 1 through 4 and ?$7,576 at the end of year 5. Her research indicates that she must earn 9?% on? low-risk assets, 14?% on? ave..

  Symantec does not currently pay dividend

Symantec does not currently pay a dividend, however, in 4 years you expect they will pay their first dividend and it will be $2 per share. The dividend is expected to grow at a rate of 4% and investors’ required rate of return for Symantec stock is 8..

  How many years is it until this bond matures

The Lo Sun Corporation offers a 6.1 percent bond with a current market price of $781.50. The yield to maturity is 8.43 percent. The face value is $1,000. Interest is paid semiannually. How many years is it until this bond matures? The outstanding bon..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd