Suppose your business needs to borrow $8,000,000 in six months that you can repay three months later. In order to hedge against an increase in interest rates in six months, your company concludes an FRA (6×9) with a bank at the FRA rate of 2%, with a notional capital of €8,000,000 If in 6 months, the interest rate increases to 2.5%, who will pay the compensation?

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No te O IF interect rate dropped then compo... View the full answer