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Financial Risk Manager Part 1

Financial Risk Manager Part 1

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A trader is analyzing forward rates by utilizing the current term structure of continuously compounded zero rates. They have compiled the following data:

Maturity in yearsZero rate (%)
11.50
22.00
32.50
43.00
53.50

Using the above information, calculate the approximate forward rate for a period that commences in 3 years and extends for 2 years.

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