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Fixed vs Floating Rate Instruments [Video]

Fixed vs Floating Rate Instruments

A fixed-rate instrument has an interest rate that is set at the contract inception and remains constant throughout the life of the instrument.
• The value of a fixed-rate instrument is the present value of its expected cash flows
• Most residential mortgages are fixed-rate instruments

A floating-rate instrument has an interest rate that changes throughout the life of the instrument.
• The rate is usually tied to an index, such as the 1-month LIBOR.
• The “reset date” or “rate fixing date” is when the new rate is determined for calculating future interest (a floating-rate instrument that resets quarterly would thus have a new interest rate every 3 months)
• Many commercial loans, credit cards, and home equity lines of credit are floating-rate instruments

Valuing a floating-rate instrument can be difficult because the amount of all future cash flows is not known at inception. One way to value the instrument is to predict what future interest rates will be at the reset dates (either by calculating implied forward rates or using a forecasting model) and then discount the expected cash flows as you would do with a fixed-rate instrument.

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Resources for Accountants

How to Start and Fund Your Own Business [Video]

Embarking on the journey of starting and funding your own business is akin to setting sail on uncharted waters. It's a thrilling yet daunting endeavor that demands a blend of creativity, strategy, and financial acumen. In today's dynamic business landscape, where innovation and disruption reign supreme, the allure of entrepreneurship beckons individuals eager to carve their own path and leave a mark on the world. However, navigating the complexities of business ownership requires careful planning, unwavering commitment, and access to adequate funding. This guide aims to illuminate the path ahead, offering a roadmap for aspiring entrepreneurs to transform their vision into a tangible business reality.

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Resources for Accountants

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Resources for Accountants

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Resources for Accountants

Cheap Car Insurance Renewal Cost ★ 2022 [Video]

Discover cheaper car insurance renewal cost. Here’s the free service we use to get cheaper car insurance (toll free): 1-855-981-7528. It’s a free by phone service that specializes in locating the cheapest car insurance rates. They perform the tedious task of shopping around, and present you with the cheapest auto insurance provider for your location. We call this service every year before our auto insurance expires. It allows us to discover whether there is a cheaper rate than ours, and has saved us lots of money over the years. Here are some of the topics covered in this video: How to get cheaper auto insurance rates online, get discounts and lower your policy cost, ways to lower vehicle insurance premium cost, which are the best car insurance companies and why Geico, National, Progressive, Allstate, Root, State farm, General, or farmers are not always the best bet. Why Dave Ramsey is not always right. Ways to get affordable drivers insurance quotes, how to locate the best cheap automobile insurer for a specific location. For more ways to save on your car insurance rates, see here: https://www.bizmove.com/auto-car-insurance/