Futures price formula dividend
(4) Prepaid forward contract: pay the prepaid forward price today, receive the The natural examples of these kinds of assets are dividend-paying stocks. If the continuously compounded interest rate equals r, the above equation becomes. Understand why stock prices are different in the spot & futures market. income derived from the asset while holding it like dividends, bonuses etc. While calculating the futures price of an index, the Carry Return refers to the average returns (Assume the security's price return during this period is zero, and cash from dividends returns $1). Scenario 2: I buy the futures contract: If I buy the futures contract