question archive The stated annual spot rate are as follows but compounded on a semi-annual basis: Maturity Yield 1 year 2
The stated annual spot rate are as follows but compounded on a semi-annual basis: Maturity Yield 1 year 2
Subject:FinancePrice:2.86 Bought8
The stated annual spot rate are as follows but compounded on a semi-annual basis:
|
Maturity |
Yield |
|
1 year |
2.584% |
|
2 years |
2.883% |
|
3 years |
2.961% |
Calculate the rate for these periods:
- Forward rate for 1-year issued 1 year from today
- Forward rate for 2-year issued 2 years from today
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(a) forward rate for 1-year issued 1 year from today= 3.1829%
(b) forward rate for 1-year issued 2 years from today= 2.3081%
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