Pricing and Valuation of Forward Commitments (2025 Level II CFA® Exam –Derivatives–Module 1)

Learn how to price and value forward commitments for the CFA Level II Derivatives topic with Professor James Forjan, PhD, CFA. This comprehensive video breaks down each Learning Outcome Statement (LOS) in the 2025 CFA Level II curriculum, focusing on pricing mechanics, valuation logic, and no-arbitrage principles in forward, futures, and swap contracts. What You’ll Learn: Distinction between pricing and valuation in forward and futures contracts Carry arbitrage models and no-arbitrage conditions Pricing and valuation of equity forwards and futures Pricing of interest rate forwards, FRAs, and fixed-income futures Currency forwards, interest rate swaps, and equity swaps Practical arbitrage examples with spot and forward rates 📚 Continue Your CFA Prep with AnalystPrep: Level I: https://analystprep.com/shop/cfa-leve... Level II: https://analystprep.com/shop/learn-pr... Levels I, II & III (Lifetime access): https://analystprep.com/shop/cfa-unli... Prep Packages for the FRM® Program: FRM Part I & Part II (Lifetime access): https://analystprep.com/shop/unlimite... Topic 7– Derivatives Module 1 – Pricing and Valuation of Forward Commitments 0:00 Introduction and Learning Outcome Statements 6:55 LOS: Describe the carry arbitrage model without underlying cashflows and with underlying cashflows. 22:16 LOS: Describe how equity forwards and futures are priced and calculate and interpret their no-arbitrage value. 31:32 LOS: Describe how interest rate forwards and futures are priced and calculate and interpret their no-arbitrage value. 43:49 LOS: Describe how fixed-income forwards and futures are priced and calculate and interpret their no-arbitrage value. 49:40 LOS: Describe how interest rate swaps are priced and calculate and interpret their no-arbitrage value. 1:01:33 LOS: Describe how currency swaps are priced and calculate and interpret their no-arbitrage value. 1:04:15 LOS: Describe how equity swaps are priced and calculate and interpret their no-arbitrage value. #CFA #CFALevelII #CFAExam #Derivatives #ForwardCommitments #FinancialModeling #Investing #Finance #AnalystPrep #JamesForjan #CFAPrep #QuantitativeFinance #CFADerivatives #CFA2025