Decimal Precision (SWAPS) different, noticed, factors, multiple, discount

bcp901

Hey, when calculating discount factors for these SWAP questions, how many decimal precision should we use? I noticed when I utilized up to 5 dec. pts, the answer can be slightly different than the multiple choice.

Please advise.

Sportsman

I use 4 or 5...I am hoping the answer are not very close or maybe they will tell us?

19831985

This drives me crazy. I go for 4 for the discount factors and then 2 for the rates or coupon per dollar of notional.

bolligerallstar

Shwaeser always round to 4 d.p in their solutions, and carry on those 4 d.p figures for future calculations.

I say stick with 4.

Newhuman

My answers are never spot on. I had to redo the once in the mock twice because of decimal rounding. When you have $250,000,000 of notional it's pretty easy to get vastly different amounts. I'm hoping the exam answers look like this:

a) $1,000,000,000,000
b) -$1,000,000,000,000
c) $54,056

yospaghetti

Chuckrox8 Wrote:
-------------------------------------------------------
> My answers are never spot on. I had to redo the
> once in the mock twice because of decimal
> rounding. When you have $250,000,000 of notional
> it's pretty easy to get vastly different amounts.
> I'm hoping the exam answers look like this:
>
> a) $1,000,000,000,000
> b) -$1,000,000,000,000
> c) $54,056


Just hope the vignette isn't about Dr. Evil enterprises

madaochenggong

I am using 4

scarecrow

I just use the Store and Recall functions to avoid truncating.

chaojimali

grumble, i do the same, but the answers are always rounded off early and they carry on with the rounding, like what deepstack31 suggested. i wish they could just stick with the figure that wasn't rounded... the way it should be done.