# Hot do I calculate an effective forward rate? [closed]

I have to find nominal and effective forward interest rate for 3M-9M term, knowing that current interest rates are:

• 3M - 2.05%
• 6M - 2.04%
• 9M - 2.03%
• 12M - 2.02%

For a nominal interest rate I just solve for $r$ the following equation:

$$(1+\frac{2.05\%}{4})(1+\frac{r}{2})=(1+2.03\%\cdot\frac{3}{4})$$

I will have some $r$ (nominal i.r.) but how can I find an effective interest rate? Won't it be the same as nominal?

## closed as off-topic by vanguard2k, SRKXNov 26 '14 at 9:23

This question appears to be off-topic. The users who voted to close gave this specific reason:

• "Basic financial questions are off-topic as they are assumed to be common knowledge for those studying or working in the field of quantitative finance." – vanguard2k, SRKX
If this question can be reworded to fit the rules in the help center, please edit the question.

• This is basic financial question and hence is off-topic here, see the faq. – SRKX Nov 26 '14 at 9:23
• You will find how to do it on wikipedia – SRKX Nov 26 '14 at 9:24
• Not everyone coming here is in an expert and an answer to this could be helpful – despuestambien Aug 12 at 15:55