Why must a forward price equal the spot price on the settlement date of the forward contract?

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Why must a forward price equal the spot price on the settlement date of the forward contract? That is, why do many forward prices converge to spot prices at settlement?

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Financial Trading And Investing

ISBN: 9780323909556

3rd Edition

Authors: John Teall

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Question Posted: Nov 18, 2023 07:00 AM

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Why must a forward price equal the spot price on the settlement date of the forward contract?

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Ignoring market frictions forward contract prices must ...View the full answer

Financial Trading And Investing

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