User Account

All Pages

Futures contracts will bank need to cover overall exposure

Assignment Help Financial Management
Reference no: EM132069709

Write a paper answering the following two questions:

By what amount will the market value of a Treasury bond futures contract change if interest rates rise from 5% to 5.25%? The underlying Treasury bond has a duration of 10.48 years, and the Treasury bond futures contract is currently being quoted at 113-06. (Remember that Treasury bonds are quoted in 32nds.)

Morning View National Bank reports that its assets have a duration of 7 years, and its liabilities average 1.75 years in duration. To hedge this duration gap, management plans to employ Treasury bond futures, which are currently quoted at 112-170 and have a duration of 10.36 years. Morning View’s latest financial report shows total assets of $100 million and liabilities of $88 million. Approximately how many futures contracts will the bank need to cover its overall exposure?

Reference no: EM132069709

Questions Cloud

Perform your own research on values or experiences : Perform your own research on values or experiences of these populations that may impact work with them. Post a comparison of the cultural values of African.
Compute the dividend payout ratio : Throughout the year, 420,000 shares of common stock and 210,000 shares of preferred stock were outstanding. The dividend payout ratio is closest to
Write a paper that defines and describes emotional : Write a paper that defines and describes emotional intelligence. Additionally, detail the value of EI possession among health care leaders.
Write a memo about the red zuma project : Complete the Red Zuma Project. You will start with your Microsoft Project file. You will need to turn in the Microsoft Project file along with a Memo.
Futures contracts will bank need to cover overall exposure : Approximately how many futures contracts will the bank need to cover its overall exposure?
Discuss the impact of internal and external forces : Discuss the impact of both the identified internal and external forces on the organization's ability to develop a competitive strategy.
Assume that the roe and payout ratio stay constant : Assume that the ROE and payout ratio stay constant for the next four years.
How many pounds of raw materials should be purchased : Crespo Company has 160,000 pounds of raw materials on hand January 1st. How many pounds of raw materials should be purchased in January
What is the effective gross income multiplier : You are considering the purchase of a quadruplex apartment building. What is the overall capitalization rate? What is the effective gross income multiplier?

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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