Six-month futures contract on treasury bond

Assignment Help Financial Management
Reference no: EM131511026

Calculate the value of a six-month futures contract on a Treasury bond. You have the following information: (Do not round intermediate calculations. Round your answer to 3 decimal places.)

- Six-month interest rate: 9% per year

- Spot price of bond: 91.75.

- Bond coupon: 7%, paid as 4% every six months.

Reference no: EM131511026

Questions Cloud

Calculate the profit or loss on the futures contract : Calculate the profit or loss on the futures contract. What is the total cost to Phoenix of buying the platinum?
What is the option delta : What is the value of a one-month call option with an exercise price of $40? What is the option delta?
What is its market price : If the yield to maturity on the bond is 8%, what is its market price?
About change in the value of the british pound : What must the CFO have expected about change in the value of the British pound over the year to believe in March, 2016
Six-month futures contract on treasury bond : Calculate the value of a six-month futures contract on a Treasury bond.
What should the current price be : A bond with a $10,000 par value has an 7.25% coupon rate. What should the current price be?
Calculate the value of the put if it had been european-style : Calculate the value of the Buffelhead American put. Calculate the value of the put if it had been European-style.
Put option written on the same stock at the same time : A put option written on the same stock at the same time, with the same exercise price and expiration date.
What return should investors expect to earn on these bonds : What is their nominal yield to maturity? What return should investors expect to earn on these bonds?

Reviews

Write a Review

Financial Management Questions & Answers

  What is project mirr

1. You're evaluating a project with the following cash flows: initial investment is $7 million dollars, and cash flows for years 1-3 are $5, $8 and $15 million dollars, respectively. The firm's WACC is 6%. What is this project's MIRR?

  What is effective annual rate on this arrangement

A firm sells its $1,090,000 receivables to a factor for $1,079,100.The average collection period is 1 month. What is effective annual rate on this arrangement

  Capital investment project will require an initial outlay

A capital investment project will require an initial outlay of $55,000 and is expected to generate an after-tax net cash flow of $7,500 in one year. After-tax net cash flows are then expected to grow at a rate of “g” per year for 5 years, ending 6 ye..

  What is the macaulay duration-modified duration

What is the Macaulay duration of a 5.4 percent coupon bond with nine years to maturity and a current price of $1,055.40? What is the modified duration?

  Initial outlay-what is the net present value of the project

A project has an initial outlay of $1,964. It has a single payoff at the end of year 7 of $6,219. What is the net present value (NPV) of the project if the company’s cost of capital is 10.89 percent?

  Determine the? equal-annual-end-of-year payment required

Determine the? equal, annual,? end-of-year payment required each year over the life of the loan shown in the following table to repay it fully during the stated term of the loan. The amount of the? equal, annual,? end-of-year payment, CF, is ? Round ..

  Calculating discounted payback

An investment project costs $10,000 and has annual cash flows of $2,850 for six years. What is the discounted payback period if the discount rate is zero percent? What is the discounted payback period if the discount rate is 5 percent?

  What is the present value of the salary

Your first job pays your $45,000 first year, $48,000 second year and $49,000 third year. Then you switch to another job and make $53,000 in the first year. Your pay increases by 4% for the next six years (10 years total). What is the Present Value (P..

  A zero bond with a long maturity date

A zero bond with a long maturity date has:

  About the merger valuation

Harrison Corporation is interested in acquiring Van Buren Corporation. Assume that the risk-free rate of interest is 6% and the market risk premium is 8%. Harrison estimates that if it acquires Van Buren, the year-end dividend will remain at $2.80 a ..

  Describe concept of value as it relates to value analysis

Describe the concept of value as it relates to value analysis. Provide examples of how an organization can increase value to itself or to its customers.

  Globalism trend affect cost and benefit analysis

Can ethics as it relate to technology be taught at CanGo? Why or why not? How does the globalism trend affect CanGo cost/benefit analysis?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd