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e to the power
AFM
answered on 23-Jan-25 18:41
sir in the question given e^0.015858, but 10.50%*58/365 = 0.0166849, whats the issue here ?, like why difference in the e to the power
latest answer
Another way to solve this question is assuming that 10.5% in not compounded rate but annual rate , then to convert an annualized rate to continuous rate we compute natural log of (1+10.5%) ln (1.105) = 0.0998 i.e 9.98% Then instead of using 10.5% use this 9.98% 9.98% x 58/365 = 0.015858 The e power 0.015858 = 1.01598 Multiply 5900 with 1.01598 to get = 5994.288 This will give a slightly diff answer
Hemachandra D
CA Final
★ 9K+
3
404
IRRM - Interest rate collar
AFM
answered on 23-Jan-25 05:57
Under, Interest rate collar should floor option premium necessarily compensate cap option premium in full?
latest answer
No If it fully compensates it is called a special or zero cost collar Else it is just a normal collar which may have some premium
Durai Murugan
CA Final
★ 470
1
303
For cancellation after due date, why not not exercise the option and let it lapse?
AFM
answered on 22-Jan-25 20:27
For cancellation after due date, why not not exercise the option and let it lapse? Why are we squaring it off.
latest answer
because on due date itself bank would have entered into OPFC , just in case cust comes back in next 3 days Pls rewatch 3 videos before ill 82
Manu Jacob
CA Final
★ 6K+
1
284
Will the bank not enter into a new back to back transaction for renewal on 28 Feb
AFM
answered on 22-Jan-25 20:29
Will the bank not enter into a new back to back transaction for renewal on 28 Feb?
latest answer
It will but those details are not provided to us
Manu Jacob
CA Final
★ 6K+
1
225
Gain or loss due to forward
AFM
answered on 22-Jan-25 18:07
Sir, in this illustration for part 2 question how Rs. 2500 is gain? Forward rate to sell USD by exporter after 3 months is Rs. 72.95 and actual spot after 3 months to sell USD by exporter is Rs. 73. Due to forward contract, we received Rs. 3647500 [50000USD*72.95]. If we not entered in to forward contract, we could have received Rs. 3650000 [50000USD*73] based on actual spot after 3 months. So difference of Rs. 2500 has to be loss for exporter. How it is gain?
latest answer
Thank you sir. I’m misunderstood the question
Malaivalar mangai
CA Final
★ 0
2
273
Margin
AFM
answered on 22-Jan-25 14:02
Sir as the bank has entered into Buy USD Fwd to cover its position it has entered into Back to Back transaction with Interbank to Sell Fwd @ x rate. When customer seeks Extension and the Banker won't get USD from the Customer, to honour Interbank Sell Fwd the Banker will Buy USD at Spot from Interbank to settle it right? So when the Banker is Buying USD at Spot from Interbank, The interbank charges 0.20% Margin as it Sale from Interbank's Perspective. Am I right sir? ( Margin from Interbank POV? )(For Interbank the banker is customer?) When the Bank enters into New Fwd Contract it charges margin to its Customer ( Margin From Banker POV )
latest answer
Yes to both
Mohanbabu N
CA Final
★ 3K+
1
293
IFM - APV
AFM
answered on 21-Jan-25 19:05
In ILL 11, alternate solution is arrived considering interest subsidy. So, if there is any loan repayment subsidy instead of interest itself, should we include or exclude the PV of the loan repayment subsidy when calculating the APV?
latest answer
Thankyou sir
Durai Murugan
CA Final
★ 470
2
258
Due Diligence Fees
AFM
answered on 21-Jan-25 15:39
Sir , In material it is mentioned that Due diligence fees is borne generally by VC (@ Pg 244 in theory complier), but in the video it is said that Due diligence fees is borne generally by Start-ups (@ 02:30Min)
latest answer
Ok sir thank you 👍🏻
Lokesh Reddy
CA Final
★ 530
3
294
Exchange Margin
AFM
answered on 20-Jan-25 21:28
Sir Can you explain the Concept of Exchange Margin? In this Sum when the Buyer Cancels the contract, the Banker sells USD at Spot right? The Banker will get 65.96 or 65.8950 when they sell at Spot Market?
latest answer
Mostly yes
Mohanbabu N
CA Final
★ 3K+
5
390
Why are we multiplying with (1-5.3%) and not directly with -5.3%
AFM
answered on 20-Jan-25 19:06
Why are we multiplying with (1-5.3%) and not directly with -5.3%. I am confused, please explain.
latest answer
Negative return
Manu Jacob
CA Final
★ 6K+
1
438