Skip to content

The forward premium (discount)

June 13, 2012

(Forward Rate – Spot Rate) / Spot Rate = (Rfc – Rdc) / (1 + Rdc)

  • Rdc is the interest rate of currency DC the domestic currency
  • Rfc is the interest rate of the currency FC the foreign currency
Advertisements

From → Economics

Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: