International Finance Sums Summary for April 2014 Exams


0

I.f sums summary!!
Chap1: FEA 1
TOPIC 1:
INVERSE/RECIPROCAL
B=1/A
A=1/B
INTERCHANGE D BASE N VARIABLE OF D GIVEN QUOTE AND FIND A 2nd NEW QUOTE!

TOPIC 2:
DIRECT N INDIRECT RATES
BASE:INDIRECT
VARIABLE:DIRECT
Calculate direct form or indirect form(use inverse method)

TOPIC 3:CROSS RATE
(1st currency/common currency)* (common currency/2nd currency)
How to identify?
2 quotations
3 currency
1 currency common
Eliminate d common currency
With d remaining 2 currency find a 3rd new quotation!!
Topic 4:
Percentage spread:
1.spread=ask-bid

2.%spread=spread/mean×100

3.%spread= ask-bid/ask+bid×200

4.point=1/10000 of the number

5.mean/mid/flat/avg rate=ask+bid/2

6.bid rate=mean – spread/2

7.ask rate= mean + spread/2
(Imp ques 11/12/13/14)

Topic 5:TWO POINT ARBITRAGE/GEOGRAPHICAL
(IMP TOPIC)
How to identify?
2 quotations will b given n u wl b askd to calculate arbitrage gain or arbitrage oppotunites!

TOPIC 6:(IMP TOPIC)
THREE POINT ARBITRAGE/TRIANGULAR
How to identify?
3 quotations will b given n u will b askd to calculate arbitrage gain or arbitrage opportunites
(Sums divided into 2 types)
Sums 1 to 4 one way quotations
Sums 5 to 13 two way quotations

Chapter 2:
FEA 2:
TOPIC 7:
FORWARD RATES (FORMULA METHOD)
F=S×(1+rv÷100×n÷12)
          _____________
          (1+rb÷100×n÷12)
With dis formula u can find
F,S,rv n rb!
How to identify?
If one numerical value of any 3 things r given n 1 value is missing dah means its formula method!

TOPIC 8:
CALCULATION OF SWAP POINTS
Fb=Sbid ×(1+ Rv d.r÷100 × n÷12)
                _________________
                (1+R.b l.r÷100 × n÷12)
            ____________________
Fa=Sask×(1+Rv l.r÷100 ×n÷12)
                  ——————-
                  (1+Rb d.r÷100×n÷12)
How to identify:
D topic is n extension of formula method
Here 2 numerical value of f,s,rv n rb will b given
Any one askd to find its swap points method

TOPIC 9:
FORWARD RATES(TABLE METHOD)
VARIETY 1:
SUM#1&2
(OUTRIGHT FORM):
(CONVERTING SWAP POINTS INTO FWD FORM)

VARIETY 2
SUM#3&4
(CAL OF SPECIFIC NO OF DAYS)

VARIETY 3
SUM#5&7
(CAL OF SPECIFIC DATE)

As of now only 3 varieties in syllabus

TOPIC 10:
AFM
(IMP TOPIC)
STRESS ON SUM 11/12/13
AFM= F-S÷S ×12÷n ×100

AFM= Rv -Rb

Topic 11:COVERED INTEREST ARBITRAGE:
(COMPULSARY TOPIC SECTION 1 Q 2A)
Step 1:
Identification
Step2:
Borrowings
Step3:
Investment
Step 4:
Arbitrage Gain
Note:
***Wenever we borrow base currency
In convert step (P×S)
In reconvert step (÷F)

***wenever we invest in variable currency
In convert step (P÷S)
In reconvert step ×F
Special note:dont stress more on case 2 sums i.e 5/6/7/8
Not askd in m.u paper so far!!

TOPIC 12:
BORROWING N INVESTMENT DECISION

FORMULA:
BORROWING
P÷Sbid ×(1+Rl.r÷100×n÷12)×Fask-P

IN A BORROWING SUM ALWAYS CONSIDER LOWEST VALUE 
AS ANS

INVESTMENT
P÷Sask×(1+R d.r÷100×n÷12)×Fbid-P

IN INVESTMENT SUM ALWAYS CONSIDER D HIGEST VALUE AS ANS
With 6 topic ur chap 2 of sums ends
Best of luck 🙂

 

Source : WhatsApp forwards


Like it? Share with your friends!

0
BMS Team

We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected].

96 Comments


Warning: Undefined array key "html5" in /home/bmsnewco/public_html/wp-content/plugins/facebook-comments-plugin/class-frontend.php on line 140

Facebook comments:

This Website Is For Sale. Email us an offer we cannot refuse on [email protected] :)

X
Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Poll
Voting to make decisions or determine opinions
Story
Formatted Text with Embeds and Visuals
List
The Classic Internet Listicles
Countdown
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Meme
Upload your own images to make custom memes
Video
Youtube and Vimeo Embeds
Audio
Soundcloud or Mixcloud Embeds
Image
Photo or GIF
Gif
GIF format