Difference between the profit for a and the profit for b

Reference no: EM132075950

Question: The S&R index currently has a price of 1000, and it doesn't pay dividends. The annual force of interest is 4.94%. A buys the index and B enters a forward purchase agreement. What is the difference between the profit for A and the profit for B if the spot price of the S&R index is 1020 at expiration in 6 months?

Reference no: EM132075950

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