Problemsuppose the stock index value is 900 the risk free, Ask an Expert

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Suppose the stock index value is 900, the risk free rate is 1%, and the dividend yield is 2.5%. What arbitrage transaction would you take if the six-month forward price of the index is 900? Demonstrate the arbitrage is profitable. Please provide step by step solution and show all work.

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Basic Finance, Finance

Category:- Basic Finance
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