Consider a six-month futures contract on the S&P 500 Index. Suppose that the stock index provides a continuously compounded dividend yield of 1.4% per year, that the current index level is 2109, and that the continuously compounded risk-free interest rate is 0.1% per year. What is the futures price?

Answer rating: 100% (QA)

To calculate the futures price we can use the formula Futures Price Spot Price er ... View the full answer