Forward Rates: Basics
Interactive

Forward Rates: Basics

Intuition Publishing Pty Ltd
Updated Sep 24, 2020

We discuss the reasons behind the need for forward rates, and introduce a few scenarios to demonstrate their usefulness. We then give a few examples of forward rates with different start dates and borrowing periods. We then look at forward curves, and develop a forward curve using a series of forward rates. Finally we examine forward rate agreements (FRAs) and give an example of some 3-month FRAs.

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