IFSCA Grade A Formula Sheet
Ten formulas, what each one is for, and a worked example.
IFSCA regulates banking, capital markets, insurance and funds in GIFT City, and its Grade A Paper 2 reflects that breadth. Its numerical questions draw on bonds, derivatives, funds and corporate finance.
These ten formulas cover them, with a worked yield-to-maturity example.
You save ₹700
- Phase I full mocks
- Phase II stream banks
- IFSC framework coverage
One payment, no subscription
The 10 Formulas
1
Formula
Approximate YTM
Expression
[C + (F − P) ÷ n] ÷ [(F + P) ÷ 2]
Use it for
Bond yield without iteration.
2
Formula
Current yield
Expression
Annual coupon ÷ Market price
Use it for
Income return on a bond.
3
Formula
Modified duration
Expression
Macaulay duration ÷ (1 + y)
Use it for
Bond price sensitivity: ΔP% ≈ −MD × Δy.
4
Formula
Forward exchange rate
Expression
F = S × (1 + r_d × t) ÷ (1 + r_f × t)
Use it for
Interest rate parity for currency forwards.
5
Formula
Long call payoff
Expression
max(S_T − K, 0) − Premium
Use it for
Options.
6
Formula
Futures fair price
Expression
F = S × (1 + r × t) − Income
Use it for
Cost-of-carry pricing.
7
Formula
NAV
Expression
(Assets − Liabilities) ÷ Units outstanding
Use it for
Fund valuation.
8
Formula
CAPM
Expression
E(R) = R_f + β × (R_m − R_f)
Use it for
Required return.
9
Formula
Sharpe ratio
Expression
(R_p − R_f) ÷ σ_p
Use it for
Fund performance.
10
Formula
Enterprise value
Expression
Market cap + Debt − Cash
Use it for
Corporate valuation.
| # | Formula | Expression | Use it for |
|---|---|---|---|
| 1 | Approximate YTM | [C + (F − P) ÷ n] ÷ [(F + P) ÷ 2] | Bond yield without iteration. |
| 2 | Current yield | Annual coupon ÷ Market price | Income return on a bond. |
| 3 | Modified duration | Macaulay duration ÷ (1 + y) | Bond price sensitivity: ΔP% ≈ −MD × Δy. |
| 4 | Forward exchange rate | F = S × (1 + r_d × t) ÷ (1 + r_f × t) | Interest rate parity for currency forwards. |
| 5 | Long call payoff | max(S_T − K, 0) − Premium | Options. |
| 6 | Futures fair price | F = S × (1 + r × t) − Income | Cost-of-carry pricing. |
| 7 | NAV | (Assets − Liabilities) ÷ Units outstanding | Fund valuation. |
| 8 | CAPM | E(R) = R_f + β × (R_m − R_f) | Required return. |
| 9 | Sharpe ratio | (R_p − R_f) ÷ σ_p | Fund performance. |
| 10 | Enterprise value | Market cap + Debt − Cash | Corporate valuation. |
Worked Example: Approximate YTM
A 5-year bond with an 8% coupon and ₹100 face value trades at ₹95.
- 1
Annual gain to maturity
(100 − 95) ÷ 5 = ₹1 a year.
- 2
Average investment
(100 + 95) ÷ 2 = ₹97.5.
- 3
YTM
(8 + 1) ÷ 97.5 ≈ 9.23%, above the coupon because the bond trades below par.
Real exam-format questions. No signup.
Discount Bond, Yield Above Coupon
A bond priced below face value has a YTM above its coupon. One priced above par has a YTM below its coupon. Use this to eliminate options before calculating.
FAQs
Which IFSCA streams sit this Paper 2?expand_more
The General stream. Legal and IT streams sit different Paper 2s.
Is the approximate YTM exact?expand_more
No, it's an estimate. It's usually close enough to pick the right option.
Why does IFSCA test derivatives?expand_more
Because IFSC exchanges list derivatives, and IFSCA regulates them.
Next steps
Take a full IFSCA Grade A mock testFull Phase 1 mocks on this exact syllabus, scored instantly.