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Reflections on the definition of European dollar futures price: Why is its price formula in the following form:10000 * [100-0.25 * (1
Because the quotation of Eurodollar is 100-R, but the price formula is p =10000 * [100-0.25 * (100-r)] Note that R in the formula is Eurodollar lending rate, and it has no percent sign, because it is multiplied by.

It is difficult for many people to understand why the quotation and price formula seem to be different. You can understand R here as the discount rate. The quotation here is actually the present value discounted in years, but the price formula needs to convert years into three months, so there is a coefficient of 0.25. The quotation of 100-R represents the euro with face value of 100. Calculated by the discount rate r (annual discount rate), the present value should be 100-R yuan. Then because the term of Eurodollar is three months, the nominal principal is actually $654.38+00,000. Therefore, with a three-month term and a discount rate of R, the current price of 65,438+000 euros should be 65,438+000-0.25 (65,438+000-R), and 65,438+000,000 dollars includes 65,438+000 dollars, so it should be The calculated price difference is the profit and loss range of multiple shorts. R every change of 1 basis point (0.0005438+0) can prove that the price of long positions in contracts has increased by $25. Pure personal understanding of originality, I hope to adopt it. Thank you.