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GARP Exam 2016-FRR Topic 3 Question 7 Discussion

Actual exam question for GARP's 2016-FRR exam
Question #: 7
Topic #: 3
[All 2016-FRR Questions]

Which one of the following four relationships should be used to price equity forwards or futures?

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Suggested Answer: C

by Aileen at Jun 15, 2025, 06:41 PM

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Stephen
18 hours ago
Option C is the way to go. It's the only one that correctly captures the relationship between the current market price and the forward or futures price.
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Beata
2 days ago
Definitely going with Option C. The formula is straightforward and aligns with the underlying principles of forward and futures pricing.
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Lavelle
6 days ago
I'm pretty sure it's Option C. The relationship makes sense intuitively, as the forward or futures price should be the current market price adjusted for the time value of money and expected dividends.
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Erasmo
10 days ago
Option C seems to be the correct one. The forward or futures price should be the market price multiplied by the term (1 + risk-free rate - expected dividend rate) raised to the power of the time to expiration.
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Rodney
4 days ago
User 1: I think the correct relationship is C.
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Viki
27 days ago
But C makes more sense because it accounts for the risk-free rate and expected dividend rate.
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Lyla
30 days ago
I disagree, I believe the correct relationship is A.
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Viki
1 months ago
I think the answer is C.
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