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Calculate the value of the forward to the short position

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Reference no: EM132920546

Problem 1: A forward contract, which was previously priced at $37.6, will expire in 200 days. The risk-free rate is 0.2% per annum with continuous compounding. Assuming that one year has 365 days and the current stock price is $43.2 per share. Calculate the value of the forward to the short position?

Choose the best answer.

a. $ 5.64
b. $ -6.61
c. $ -5.64
d. None of the other answers provided is the best answer
e. $ 6.61

Reference no: EM132920546

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