CFA Practice Question

There are 206 practice questions for this study session.

CFA Practice Question

A 60-day FRA on 180-day Libor would be referred to as ______.
A. 2 x 6
B. 2 x 8
C. 2 x 4
Explanation: The 2 indicates that the FRA expires in two months (60 days). The difference between 2 and 8, 6, indicates the underlying 180-day Libor.

User Contributed Comments 3

User Comment
kjw88 So the difference between 2 and 8 (6) refers to the fact that it is 6 month Libor?
Mclarke That is a strange naming rule, I would guess its 2X6.
PeterHaber If we have AxB it means A months loan beginning in B months, so, 60 day FRA beginning in 180+60 days. Convert it to months, 2 month FRA beginning in 8 months = 2x8
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