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Question
A portfolio manager enters into a total return swap. She swaps 50% of her $50 million index based portfolio for 4.5% yield bonds. If the annualized total return on the index is 2.5%, what net cash flow will the manager experience under the swap agreement?A) + $250,000
B) -$250,000
C) + $500,000
D) -$500,000
Answer
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Related questions
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