From the course: Derivatives Fundamentals
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Forward contract pricing: Excel demonstration
From the course: Derivatives Fundamentals
Forward contract pricing: Excel demonstration
- [Instructor] Okay, so here we have the question, what I've built is a small model in Excel that highlights the two scenarios that were just presented, but instead of focusing on those two scenarios, I'm going to focus on drawing a payoff for profit and loss diagram for this feature, and we're going to use and build a table starting in row 23. Just a quick reminder, in good models, we always have our inputs in blue font. Any number here that is not a blue font means it's a formula, so if you look in any one of these cells that is black or has black font, you'll see a formula. Just another quick reminder, if you want a format cell, so for example, we see it's $50 a barrel, you can do that quickly by selecting the cell you want to format, and hitting Control + 1, choosing Custom Format, and then in the Type window, enter the format that you want to have. So I'm not going to focus much on this table, which are the two scenarios that are directly related to the question, I'm going to…
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