FCRP always, through

malbec

I always mess up which inflation to subtract from which, is there an intuitive way to think through this?
Tks

giorgio10

agree with manstey. mush easier.

profil

Instead of remembering that formula, you can calculate the price of the forward (you should know this formula). Then the FCRP is (E(S1) - F(0))/ S0 ) or intutively, the expected premium over a risk free return.

thecfawannabe

i use Domestic - Foreign

(F - S)/S - (iD - iF)

economicz

I meant the interest rate differential my bad

neil1234

not sure what you are even asking. The formulas I think of for FCRP don't have inflation.

Rasec

anybody please?