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| Discuss Fair price of future at the Futures within the Traderji.com - Discussion forum for Stocks Commodities & Forex; Hi All, We calculate Fair price of future as follows = SP * Exp( (day/365) ... |
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#1
4th April 2008, 11:52 AM
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Fair price of future
Hi All,
We calculate Fair price of future as follows = SP * Exp( (day/365) * (Ri/100) ) SP - Spot price Ri - Rate of interest day - no of days to expire.. I would like to know. what is the value of rate of interest. Is it decided by broker or exchange?? If its decided by broker what is it for indiabulls/reliance?? Thanks Sachin 
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#2
7th April 2008, 03:33 PM
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Re: Fair price of future
None of this formula works when you observe the quotes of stock futures here.
Quote:
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#3
7th April 2008, 06:02 PM
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Re: Fair price of future
rate of interest should be calculated on the basis of Risk free rate of interest.
i.e if u r investing x amount outside(govt bonds,FD,etc.,) normally peoples will calculate treasury bond rate (MIBOR rates) if any one finds wrong.send me an mess. Regards $k
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