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Basic Question 4 of 8
An off-market forward contract is defined as a forward contract ______.
B. that has a value other than zero at inception
C. that is closed by both parties before the contract expiry date
A. that does not trade on the market
B. that has a value other than zero at inception
C. that is closed by both parties before the contract expiry date
User Contributed Comments 2
| User | Comment |
|---|---|
| Sagarsan88 | I thought swaps and fwds have value of zero at inception? |
| Fraser1997 | The swap itself has a value of zero, but the implied FRA for each individual period does not necessarily have a value of zero |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
describe how swap contracts are similar to but different from a series of forward contracts
contrast the value and price of swaps
CFA® 2024 Level I Curriculum, Volume 5, Module 7.