Amity Campus

Uttar Pradesh
India 201303

Subject Name
Study COUNTRY
Roll Number (Reg.No.)
Student Name

ASSIGNMENTS
PROGRAM: MFC
SEMESTER-IV
: Financial Engineering
: Somalia
: MFC001512014-20160164
: Kenadid Ahmed Osman

INSTRUCTIONS
a) Students are required to submit all three assignment sets.
ASSIGNMENT
Assignment A
Assignment B
Assignment C

DETAILS
Five Subjective Questions
Three Subjective Questions + Case
Study
Objective or one line Questions

MARKS
10
10
10

b)
c)
d)
e)

Total weightage given to these assignments is 30%. OR 30 Marks

All assignments are to be completed as typed in word/pdf.
All questions are required to be attempted.
All the three assignments are to be completed by due dates and
need to be submitted for evaluation by Amity University.
f) The students have to attached a scan signature in the form.

Signature :
Date
:

______
_______

_______
28-04-2014_____________ __

( ) Tick mark in front of the assignments submitted

Assignment

Assignment

Assignment
A
B
C

Financial Engineering
ASSIGNMENT A
QI. A swap bank has to entail certain risks which are inherent to the swap
business and are interrelated Explain the risks involves in swap business.
Answer:
While the earnings of the swap bank are from the bid-ask spread of
swaps and the fees charged (upfront fees), it has to entail the following risks,
which are inherent to the swap business and are mostly inter-related:
I. Interest Rate Risks: Interest rate risk arises mostly on fixed rate legs of
swaps. While the floating rate interest can be periodically adjusted to
the prevailing interest rates, the fixed rate in the market not
accompanied by a change in the yield of debt instruments of the same
time period as the interest rates will entail interest rate losses to the
bank. Unless the swap bank is fully hedged, losses will be incurred.
II. Currency Exchange Risk: Currency exchange risks happen when there
is an exchange rate commitment given to one party and there is a
steep change in the exchange rate between the currencies in the swap.
If the swap bank is not able to match the counterparty well in time, it
will incur losses due to the exchange rate difference.
III. Market Risks: Market risks occur when there is difficulty in finding
counterparty to a swap. Usually, longer maturity swaps have less
takers and vice versa. Lower the number of takers, higher the risks of
losses.
IV. Credit Risks: Credit risks are those risks which the swap bank has to
bear in case the counterparty to a swap defaults on payment due to
bankruptcy or any other defaults, legal or otherwise. The bank
continues to the obliged to pay the other party of the swap,
irrespective of the fact whether the former party defaulted or not.
Market risks and credit risks together amount to default risks of the
bank.
V. Mismatch Risk: Mismatch risks take place when the swap bank comes
across mismatches in the requirements of both counterparties to the
swap. Usually, banks have a pool of swaps and have no difficulty in
finding matches, but if no party is found, the risk of mismatch losses is

there. This risk is further aggravated in case one of the parties

defaults.
VI. Basis Risks: Basis risks take place mostly in floating-to-floating rate
swaps, when both the sides are pegged to two different indices the
sides are pegged to two different indices and both the indices are
fluctuating and there is no proper correlation between both.
VII. Spread Risk: Spread risks happen when the spread changes over the
time period the parties are matched. The spread risk is not the same
as interest rate risk, as spreads may change as a result of change in
basis points, while the interest rate may still remain constant.
VIII. Settlement Risk: Settlement risks take place when the payments of
currency swaps are made at different times of the day mainly because
of different settlement hours in capital markets of two countries
involved in the currency swap. If a limit on the size of the settlement is
placed for each day, this risk is minimized.
IX. Sovereign Risk: Sovereign risks are those risks that can take place if a
country changes its rules regarding currency deals. It mostly happens
in the underdeveloped or developing countries which tend to have
more political instability than the developed world.
Q2. Call options are said to be At the money , In the money and Out of
the money depending on whether the exercise price is equal to or less than
or greater than the current market price of the stock. In case of Put options,
the opposite is true. Explain when a trader realizes profits in case of Call as
well as Put options with the help of simple examples.
Answer:
Call Option
A call option is an option contract in which the buyer has the right but
not the obligation to buy a specified quantity of a security at a specified price
within a fixed period of time. For the seller of a call option, it represents an
obligation to sell the underlying security at the strike price if the option is
exercised. The call option writer is paid a premium for taking on the risk
associated with the obligation. Suppose a call option with an exercise price
equal to the price of the underlying (100) is bought today for $1.
At expiry, if the securitys price has fallen below the strike price, the
option will be allowed to expire worthless and the position has lost $1. This is

the maximum amount that you can lose because an option only involves the
right to buy or sell, not the obligation. In other words, if it is not in your
interest to exercise the option you dont have to and so if you are an option
buyer your maximum loss is the premium you have paid for the right. BEP
will be 101.
If, on the other hand, the securitys price rises, the value of the option
will increase by $1 for every $1 increase in the securitys price above the
strike price (less the initial $1 cost of the
Now look at the profit/loss for a short call.

Here profit is limited to the premium received for selling the right to
buy at the exercise price - again $1.
For every $1 rise in the price of the underlying security above the
exercise price the option falls in value by $1.
Here again, the breakeven point is 101.
Put Option
A put is the reverse of a call in that the value of the position rises as
the price of the underlying security falls.
Here is the profit/loss graph for a long put.

At expiry the put is worth nothing if the securitys price is more than
the strike price of the option but, as with the long call, the option buyers loss
is limited to the premium paid.
The breakeven for this option is 99, so the put purchaser makes money
if the underlying security is priced below 99 at expiry.
And here is the profit/loss graph for a short put.

Here profit is limited to the premium received for selling the right to
sell at the strike price.
For every $1 fall in the price of the underlying security below the strike
price the option falls in value by $1.
Here again, the breakeven point is 99.

Q3. Write short notes on

(a) LBO or (b) Corporate restructuring
Answer:
A) A Leveraged Buy-Out (LBO) is a transaction in which capital
borrowed from a commercial lender is used to fund a large portion of the
purchase. Generally, the loans are arranged with the expectation that the
earnings of the business will easily repay the principal and interest. The LBO
potentially has great rewards for the buyers who, although they frequently
make little or no investment, own the tar- get company free and clear after
the acquisition loans are repaid by the earnings of the business. LBOs are
often arranged to enable the managers of subsidiaries or divisions of large
corporations to purchase a subsidiary or division which the corporation wants
to divest, known as an MBO, or management buy-out.
The LBO transaction will generally take one of two basic forms: the sale
of assets or the cash merger. Under the cash merger format, the acquired
company disappears upon merger into the acquiring company and its
shareholders receive cash for their shares. Under the sale of assets format,
on the other hand, the operating assets become part of the buying company
but the selling company will generally be given the option of either receiving
cash or continuing to hold their shares in the selling company.
At the heart of the LBO transaction are the dynamics of financing the
acquisition by employing the assets of the acquired company as a basis for
raising capital. Large unused borrowing capacity is the characteristic which
typically enables a purchaser to use the sellers assets to borrow the
purchase price.
B) Corporate Restructuring is the process of redesigning one or
more aspects of a company. The process of reorganizing a company may be
implemented due to a number of different factors, such as positioning the
company to be more competitive, survive a currently adverse economic
climate, or poise the corporation to move in an entirely new direction. Here
are some examples of why corporate restructuring may take place and what
it can mean for the company.
Restructuring a corporate entity is often a necessity when the company
has grown to the point that the original structure can no longer efficiently
manage the output and general interests of the company. For example,

a corporate restructuring may call for spinning off some departments into
subsidiaries as a means of creating a more effective management model as
well as taking advantage of tax breaks that would allow the corporation to
divert more revenue to the production process. In this scenario,
the restructuring is seen as a positive sign of growth of the company and is
often welcome by those who wish to see the corporation gain a larger market
share.
In general, the idea of corporate restructuring is to allow the company
to continue functioning in some manner. Even when corporate raiders break
up the company and leave behind a shell of the original structure, there is
still usually the hope that what remains can function well enough for a new
buyer to purchase the diminished corporation and return it to profitability.
Q4. Futures rely on a great deal on expected spot prices. The
theoreticalframework suggests that forward rates reflect the
expected spot rates. How futures differ from forwards? Explain.
Answer:
A forward contract is an agreement between two parties to buy or
sell an asset (which can be of any kind) at a pre-agreed future point in time
at a pre-agreed price. A futures contract is a standardized contract, traded
on a futures exchange, to buy or sell a certain underlying instrument at a
certain date in the future, at a specified price. So while the date and price
are decided in advance in forward contract, a futures contract is more
unpredictable. They also differ in the forms that a futures contract is
standardized while a forward contract is made to the customer's need.
Standardization and exchange based trading of futures is the
underlying reason for most of the differences between a forward and future
transaction. Even though it may be intuitive that future trades are more
constrained than forward trades and should hamper efficient markets, the
standardization of the contracts stimulates futures market and enhances
liquidity.
In contrast to forward contracts in which a bank or a brokerage is
usually the counterparty to the contract, there is a buyer and seller on each
side of a futures trade. The futures exchange selects the contract it will
trade.
The distinguishing characteristics between forward contract and futures
contract are presented below:

SI.
No.

Characteristi
cs

I.
2.

Contract Terms
,
Contract Price

3.
4.
5.
6.
7.

8.
9.

10.

Forward Contract

Decided by buyers and

sellers
Remains constant till
maturity
to Cannot be done

Futures Contract

Standardized contract
Changes every day

Marking
Done every day
Market
Margin
Not needed
Margin is to be paid by
Requirements
both buyers and sellers
Risk of Counter Exists
Does not exist
Party
Number
of No limit on the number Number
of
contracts
Contracts
ot contracts in a year
limited between 4 and 12 a
year
Hedging
Tailor-made contracts Since contract period is
makes possible perfect limited
to
a
month.
hedging
hedging not perfect
Liquidity
No liquidity
Highly liquid
Operational
Not
traded
on It is exchange-traded
Mechanism
exchange but traded
over the counter
Delivery
Delivery is specifically Standardized
and
cash
decided:
delivery of contracts
contracts usually result
in delivery

Q5. Arbitrage profits an investor told are risk less profits. You take
simultaneous but opposite positions in two markets to reap gains from
pricing disparities. Acting on this belief, his friend tried to find the arbitrage
profit by trading simultaneously in futures and stock index.
He has collected to the following information:
Pricing level of stock index _3000
Index futures priced at
2000
Risk free rate of return l0%p.a.
50% stocks are to pay dividcnds at 6%

 The index futures has a multiple of 100

The future has six months to expiration.
Required
(a) Find arbitrage profits, if any.
(b) Discuss the risks associated with arbitrage transactions in futures.
Answer:
a)
F* = S (1+r-y)t
=3000(1+0.10-.06)0.5
=1560
We have F>F* i.e 2000>1560
If F > F*
Time

Now:

At t

Action

Cash Flow

Values

1. Sell
Future 0
Contract
2. Borrow Spot price S
of index at risk
free rate
3. Buy Stock Index
(-)S

1. Collect dividends S((1+y)t-1)

on stock
2. Delivery on future F
contract
3. Pay back loan
-S(1+r)t

88.69

NCF

F-S(1+r-y)t >
0

3000@10
%
(-)3000

2000
(-)1650
440

Arbitrage Profit = 440

F* = Theoretical futures price
(annualized)
F = Actual futures price

r= Riskless rate of interest

t = Time to expiration on the futures
Contract

S = Spot level of index

futures

y = Dividend yield over lifetime of

Contract as % of current index level

b) Arbitrage transactions in modern securities markets involve fairly

low day-to-day risks, but can face extremely high risk in rare situations,
particularly financial crises, and can lead to bankruptcy. Formally, arbitrage
transactions have negative skew prices can get a small amount closer (but
often no closer than 0), while they can get very far apart. The day-to-day
risks are generally small because the transactions involve small differences
in price, so an execution failure will generally cause a small loss (unless the
trade is very big or the price moves rapidly). The rare case risks are
extremely high because these small price differences are converted to large
profits via leverage (borrowed money), and in the rare event of a large price
move, this may yield a large loss.
The main day-to-day risk is that part of the transaction fails
execution risk. The main rare risks are counterparty risk and liquidity risk
that counterparty to a large transaction or many transactions fails to pay, or
that one is required to post margin and does not have the money to do so.
In the academic literature, the idea that seemingly very low risk arbitrage
trades might not be fully exploited because of these risk factors and other
considerations is often referred to as limits to arbitrage.
Execution risk
Generally it is impossible to close two or three transactions at the
same instant; therefore, there is the possibility that when one part of the
deal is closed, a quick shift in prices makes it impossible to close the other at
a profitable price. However, this is not necessarily the case. Many exchanges
and idbs allow multi legged trades (e.g. basis block trades on LIFFE).
Competition in the marketplace can also create risks during arbitrage
transactions. As an example, if one was trying to profit from a price
discrepancy between IBM on the NYSE and IBM on the London Stock
Exchange, they may purchase a large number of shares on the NYSE and find
that they cannot simultaneously sell on the LSE. This leaves the arbitrageur
in an un-hedged risk position.
In the 1980s, risk arbitrage was common. In this form of speculation,
one trades a security that is clearly undervalued or overvalued, when it is

seen that the wrong valuation is about to be corrected by events. The

standard example is the stock of a company, undervalued in the stock
market, which is about to be the object of a takeover bid; the price of the
takeover will more truly reflect the value of the company, giving a large
profit to those who bought at the current priceif the merger goes through
as predicted.
Traditionally, arbitrage transactions in the securities markets involve
high speed, high volume and low risk. At some moment a price difference
exists, and the problem is to execute two or three balancing transactions
while the difference persists (that is, before the other arbitrageurs act).
When the transaction involves a delay of weeks or months, as above, it may
entail considerable risk if borrowed money is used to magnify the reward
through leverage. One way of reducing the risk is through the illegal use of
inside information, and in fact risk arbitrage with regard to leveraged
buyouts was associated with some of the famous financial scandals of the
1980s such as those involving Michael Milken and Ivan Boesky.
Counterparty risk
As arbitrages generally involve future movements of cash, they are
subject to counterparty risk: if counterparty fails to fulfill their side of a
transaction. This is a serious problem if one has either a single trade or many
related trades with a single counterparty, whose failure thus poses a threat,
or in the event of a financial crisis when many counterparties fail. This
hazard is serious because of the large quantities one must trade in order to
make a profit on small price differences.
For example, if one purchases many risky bonds, then hedges them
with CDSes, profiting from the difference between the bond spread and the
CDS premium, in a financial crisis the bonds may default and the CDS
writer/seller may itself fail, due to the stress of the crisis, causing the
arbitrageur to face steep losses.
Liquidity risk
Arbitrage trades are necessarily synthetic, leveraged trades, as they
involve a short position. If the assets used are not identical (so a price
divergence makes the trade temporarily lose money), or the margin
treatment is not identical, and the trader is accordingly required to post
margin (faces a margin call), the trader may run out of capital (if they run
out of cash and cannot borrow more) and go bankrupt even though the

trades may be expected to ultimately make money. In effect, arbitrage

traders synthesize a put option on their ability to finance themselves.
Prices may diverge during a financial crisis, often termed a "flight to
quality"; these are precisely the times when it is hardest for leveraged
investors to raise capital (due to overall capital constraints), and thus they
will lack capital precisely when they need it most.
ASSIGNMENT B
Q1. The following are the requirement of the type of funds and the borrowing
rates faced by three companies X, Y, Z in different markets:
Company Requirement
LIBOR Rate
T-Bill rate Fixed $
X
LIBOR based funds
LIBOR+.75%
T-Bill+.4% 5%
Y
T-Bill Based Funds
LIBOR+.5%
T-Bill+.25% 4.5%
Z
Fixed $
LIBOR+1%
T-BILL+.5% 5.5%
Three companies approach a bank individually for swap deals so that they
can reduce their cost of borrowing. You are required to structure swap
transactions between three
parties keeping Bank as an intermediary so that after keeping a margin of 10
basis points V by the Bank for each leg of swap, the rest of the gain is
distributed equally between the three parties. Also, calculate the effective
cost of borrowing to the three parties.
Answer:

T+.25

LIBOR+.70

FIXED@5%

Bank

T+.15%

Z
FIXED@5.1%

In the above structure the bank is getting 10 basis points on each swap leg
and each party I getting .05 or 5 basis points.

Q2. There are a variety of option combinations which traders adopt to suit
their risk return profile. Discuss the following option combinations:
(1) straddle
(2) strangle
Answer:
(1)Straddles are a good strategy to pursue if an investor believes that a
stock's price will move significantly, but is unsure as to which direction.
The stock price must move significantly if the investor is to make a profit.
As shown in the diagram above, should only a small movement in price
occur in either direction, the investor will experience a loss. As a result, a
straddle is extremely risky to perform.
Additionally, on stocks that are expected to jump, the market tends to
price options at a higher premium, which ultimately reduces the expected
payoff should the stock move significantly.
(2)The strategy involves buying an out-of-the-money call and an out-of-themoney put option. A strangle is generally less expensive than a straddle
as the contracts are purchased out of the money.
We can understand as per one example, suppose a stock currently trading
at $50 a share. To employ the strangle option strategy a trader enters into
two option positions, one call and one put. Say the call is for $55 and
costs $300 ($3.00 per option x 100 shares) and the put is for $45 and
costs $285 ($2.85 per option x 100 shares). If the price of the stock stays
between $45 and $55 over the life of the option the loss to the trader will
be $585 (total cost of the two option contracts). The trader will make
money if the price of the stock starts to move outside of the range. Say
that the price of the stock ends up at $35. The call option will expire
worthless and the loss will be $300 to the trader. The put option however
has gained considerable value; it is worth $715 ($1,000 less the initial
option value of $285). So the total gain the trader has made is $415.

Q3 . Option value is influenced by the option prices, which in turn depend on

a number of factors What are assumptions made by Black and Scholes
option Pricing model? Also discuss how does option premium depends on
time to expiration, Interest rates, Spot prices and strike prices.

Answer:
The Black-Scholes Option Pricing Model (OPM)
The Black-Scholes option pricing model (OPM), developed in 1973,
helped give rise to the rapid growth in options trading. This model has been
programmed into many handheld and Web-based calculators, and it is widely
used by option traders.
OPM Assumptions and Results
In deriving their model to value call options, Fischer Black and Myron
Scholes made the Following assumptions.
1. The stock underlying the call option provides no dividends or other
distributions during the life of the option.
2. There are no transaction costs for buying or selling either the stock or the
option.
3. The short-term, risk-free interest rate is known and is constant during the
life of the option.
4. Any purchaser of a security may borrow any fraction of the purchase price
at the short-term, risk-free interest rate.
5. Short selling is permitted, and the short seller will receive immediately the
full cash proceeds of todays price for a security sold short.
6. The call option can be exercised only on its expiration date.
7. Trading in all securities takes place continuously, and the stock price
moves randomly.

Option premium depends on time to expiration, Interest rates, Spot

prices and strike prices.
The Black-Scholes model is used to calculate a theoretical call price
(ignoring dividends paid during the life of the option) using the five key
determinants of an option's price: stock price, strike price, volatility, time to
expiration, and short-term (risk free) interest rate.
The original formula for calculating the theoretical option price (OP) is as
follows:

Where:

The variables are:

S = stock price
X = strike price
t = time remaining until expiration, expressed as a percent of a year
r = current continuously compounded risk-free interest rate
v = annual volatility of stock price (the standard deviation of the short-term
returns over one year). See below for how to estimate volatility.
ln = natural logarithm
N(x) = standard normal cumulative distribution function
e = the exponential function

Case study
(a) The following options are quoted at the market:
Option
Call
Put

Expiration
Strike Price
Premium
1 Month
Rs.48.5/$
Rs.0.30
1Month
Rs.48.5/$
Rs.0.05

A trader is looking at the above options and planning to adopt long strip or
long strap strategy to make profit from the rupee-dollar exchange rate
volatility.
You are required to:
I. Show the pay off profile and indicate break even points for strip and strap
strategies in a price range of Rs 47- Rs 50 for a dollar.
II. Comment on the desirability of the above two option strategies.
(b)Consider a call option on a stock with the following parameters
Stock price: Rs210
Strike Price: Rs 220
Time to expiration: 167 days
Risk free interest rate: 10 %
Variance of annual stock returns: 20%
Compute price of the call option
Answer:
Strap Position
Call Option- Strap Position
1. Strap payoff for call in the price range of Rs. 47-Rs.50 for a dollar
Profit = 2 x (Price of Underlying - Strike Price of Calls) - Net Premium
Paid
=2(48.5-47)-.30 =
2.7
=2(48.5-48)-.30 =
0.7
=2(48.5-49)-.30 = -2.7
=2(48.5-50)-.30 = -3.3

2. There are 2 break-even points for the strap position. The breakeven
points can be calculated using the following formulae.

Upper Breakeven Point = Strike Price of Calls/Puts + (Net Premium

Paid/2)
=48.5+(0.3/2) = 48.65

Lower Breakeven Point = Strike Price of Calls/Puts - Net Premium Paid

=48.5-(0.3) =

48.2

Put Option- Strap Position

1. Strap payoff for put in the price range of Rs. 47-Rs.50 for a dollar
Profit= Strike Price of Puts - Price of Underlying - Net Premium Paid
= (48.5-47)-0.05 = 1.45
= (48.5-48)-0.05 = 0.45
= ( 48.5-49)-0.05 = -0.55
= (48.5-50)-0.05 = -1.55
2. There are 2 break-even points for the strap position. The breakeven
points can be calculated using the following formulae.

Upper Breakeven Point = Strike Price of Calls/Puts + (Net Premium

Paid/2)
=48.5+(0.05/2) = 48.525

Lower Breakeven Point = Strike Price of Calls/Puts - Net Premium Paid

=48.5-(0.05) = 48.45

Strip Position
Call Option- Strip Position
1. Strip payoff for call in the price range of Rs. 47-Rs.50 for a dollar
Profit = Price of Underlying - Strike Price of Calls - Net Premium Paid

=(48.5-47)-.30
=(48.5-48)-.30
=(48.5-49)-.30
=(48.5-50)-.30

=
=
=
=

1.2
0.2
-0.8
-1.8

2. There are 2 break-even points for the strip position. The breakeven
points can be calculated using the following formulae.

Upper Breakeven Point = Strike Price of Calls/Puts + Net Premium Paid

= 48.5+0.3 =
48.8

Lower Breakeven Point = Strike Price of Calls/Puts - (Net Premium

Paid/2)
=48.5-(.3/2)=

48.35

Put Option- Strip Position

1. Strip payoff for put in the price range of Rs. 47-Rs.50 for a dollar
Profit= 2 x (Strike Price of Puts - Price of Underlying) - Net Premium Paid
= 2(48.5-47)-0.05 = 2.95
= 2(48.5-48)-0.05 = 0.95
= 2( 48.5-49)-0.05 =
-1.05
= 2(48.5-50)-0.05 = -3.05
2. There are 2 break-even points for the strip position. The breakeven
points can be calculated using the following formulae.
Upper Breakeven Point = Strike Price of Calls/Puts + Net Premium Paid
=48.5+.05 =

48.55

Lower Breakeven Point = Strike Price of Calls/Puts - (Net Premium

Paid/2)
=48.5-(.05/2)=

48.47

Comment:
Both the options strip and strap positions are desirable till the price of
underlying is 47 and 48. When price of underlying is 49 and 50 payoffs are
negative, therefore they are not desirable.

Solution (B):
The original formula for calculating the theoretical option price (OP) is as
follows:

=210*0.674 -220e-.1*0.46 0.624

=10.43

Where:

d1

= [ln(210/220)+(0.10+((0.20)2 /2))0.46]/0.200.46
= -0.046+0.407= 0.453

0.453 -0.200.46
= 0.317
The variables are:
S = stock price,
X = strike price,
t = time remaining until expiration, expressed as a percent of a year
r = current continuously compounded risk-free interest rate
v = annual volatility of stock price (the standard deviation of the shortterm returns over one year).
ln = natural logarithm,
N(x) = standard normal cumulative distribution function
e = the exponential function

ASSIGNMENT C (MCQs)
Q1
Q2
Q3
Q4
Q5
Q6
Q7
Q8
Q9
Q10

B
A
E
B
E
A
D
F
C
A

Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20

B
B
D
A
B
A
D
D
C
D

Q21
Q22
Q23
Q24
Q25
Q26
Q27
Q28
Q29
Q30

B
A
C
D
C
D
D
D
B
B

Q31
Q32
Q33
Q34
Q35
Q36
Q37
Q38
Q39
Q40

C
D
B
B
B
D
E
A
E
C

Main references:
1. http://www.wikinvest.com/wiki/Options_-_Spread
2. http://www.investinganswers.com/investment-ideas/options-derivatives/profitingoptions-152
3. http://www.wisegeek.com/what-is-corporate-restructuring.htm
4. http://www.caclubindia.com/articles/types-of-corporate-restructuring-5649.asp
5. http://www.diffen.com/difference/Forward_Contract_vs_Futures_Contract
6. http://www.differencebetween.net/business/finance-business-2/difference-betweenfutures-and-forwards/
7. http://www.investopedia.com/ask/answers/06/forwardsandfutures.asp#axzz1u6zWU7
Sn
8. www.gyankendra.com/index.php/finance/...arbitrage/1316-risks-.htm..