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Mental mathHard

A strategy earns exactly $6$ basis points of a $25000000$ notional each trading day and the notional stays fixed. There are $250$ trading days in a year. What is the total earned in a year? One basis point is $0.01%$ .

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Hint

Find the daily income first, then use a round number of days.

Solution

$6$ basis points is $0.06%$ , i.e. $0.0006$ .
Daily income is $0.0006 \times 25000000 = 25000000 \div 10000 \times 6 = 2500 \times 6 = 15000$ .
$250 = 1000 \div 4$ , so $15000 \times 250 = 15000000 \div 4$ .
The annual total is $3750000$ .

Answer: $3750000$

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