This document contains 4 questions related to banking management. Question 1 provides spot and forward exchange rates for the Indian rupee against the US dollar for various time periods and asks to calculate the forward rates, premium rates, and swap rates. Question 2 asks about trading options related to the price of company shares rising over the next few months. Question 3 provides data on load fees for a mutual fund scheme and asks about calculating front-end and back-end loads. It also asks about return requirements for an equity mutual fund. Question 4 provides closing stock prices for a company over 20 days and asks to calculate a 7-day moving average and comment on short-term trend.
1. SUBJECT:-BANKING MANAGEMENT
Total Marks—80
Q.1) The exchange rate and forward rate of rupee against US dollar on 3rd
November, 2008 is given below:
(20 marks)
Spot rate 1 US dollar Rs 45.36
One month forward 3.72%
Three months forward 3.27%
Six months forward 2.76%
Twelve months forward 2.26%
Calculate the forward rate, forward premium rate and swap rate from the given data.
Q.2) In May beginning you decide that shares in X Ltd. will rise over the next month or so. The
current price is Rs 100 and you hope that the shares will be at Rs. 150 by the end of July.
Give your comments if the Option is traded and if the option is not traded. Make assumptions.
(20 marks)
2. Q.3) (15 marks)
A) The unit price of TSS scheme of a mutual fund is Rs 10. The public offer price (POP) of the
unit is Rs 10.204 and the redemption price is Rs 9.80.
Calculate
i) Front-end load and
ii) Back-end load.
B) Mr. A can earn a return of 16% by investing in equity shares on his own. Now he is considering a recently
announced equity based mutual fund scheme in which initial expenses are 5.5 percent and annual recurring
expenses are 1.5 percent. How much should the mutual fund earn to provide Mr. A a return of 16%
(5 Marks)
Q.4) The closing price of the stock of Veryfine Ltd. at the stock exchange for 20 successive days was as
follows: (20 Marks)
Day 1 2 3 4 5 6 7 8 9 10
Closing
25 26 25 24 26 26 28 26 25 27Price(Rs.)
Day 11 12 13 14 15 16 17 18 19 20
Closing
27 25 26 28 26 26 24 25 26 25price(Rs)
You are required to calculate a 7 day moving average of stock price of the company and comment on its
short-term trend
