What would be the value of your position

Reference no: EM132181833

Question - Seaboard Corp stock is selling for 1799.20 and pays a $15 dividend in three months and again in six months.

What is the no-arbitrage price of a five-month forward contract if interest rates are 11%?

Suppose the forward contract is priced at $1,885.00 Is there an arbitrage opportunity? If so, conduct an arbitrage showing all steps. What is your profit on this arbitrage?

Suppose the forward market price was $1,860.94. What would be your arbitrage profit? (show all steps of the arbitrage)

Suppose you originally entered into a short forward position in Seaboard Corp stock at $1,870.00. In two months the spot price of the shares changes to $1,850. What is the value of your short forward position?

What would be the value of your position if this were a futures contract?

Reference no: EM132181833

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