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Business, 25.06.2020 02:01 kel3194

Value of a Forward contract at an intermediate time Suppose we hold a forward contract on a stock with expiration 6 months from now. We entered into this contract 6 months ago so that when we entered into the contract, the expiration was T=1 year. The stock price \$ 6 months ago was S0=100, the current stock price is 125 and the current interest rate is r=10% compounded semi-annually. (This is the same rate that prevailed 6 months ago.) What is the current value of our forward contract?

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Value of a Forward contract at an intermediate time Suppose we hold a forward contract on a stock wi...

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