Question: Consider SINDY Index obtained by averaging stock prices and a synthetic index SINDY spot that replicates its performance. (1) SINDYs current level I is 10,000,

Consider SINDY Index obtained by averaging stock prices and a synthetic index SINDY spot that replicates its performance. (1) SINDY’s current level I is 10,000, and the synthetic index’s price S is $10,000. (2) A newly written forward contract on the index matures after T = 0.5 years.
(3) The continuously compounded interest rate r is 5 percent per year. (4) constituting SINDY spot paid $190 of dividends last year and are expected to pay the same this year.
a. Compute the yield δ on SINDY spot.
b. Compute the forward price F.

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