Flinn et al v. Bank of America Corporation, No. 5:2015cv00193 - Document 18 (D. Vt. 2016)
Court Description: OPINION AND ORDER denying 8 Motion to Dismiss for Failure to State a Claim. Signed by Judge Geoffrey W. Crawford on 3/30/2016. (Attachments: # 1 Appendix) (esb)
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Flinn et al v. Bank of America Corporation Doc. 18 Att. 1 APPENDIX Suppose the value of the IVI depends solely upon the value of an underlying index D, and that D has achieved a relatively steady state at an average level of 100, but fluctuates between 90 and 110. Every day a rate of return is calculated that reflects the difference between the level ofD today and its level yesterday. The level ofthe IVI is initially 250, but each day is the product of the previous day's level and the rate of return. The following table illustrates the changing value of the IVI (rounded to the nearest whole number) under those conditions: Day 1 2 3 4 5 6 7 I Value ofU lOu 11 100 90 100 110 100 Rate of Return +10% -10% -10% +10% +10% -10% Value ofIVI 250 275 248 223 245 270 243 ! Even though the average value ofD holds steady at 100, the value of the IVI decreases over time. The following chart depicts the same scenario carried out for one year: 32 Dockets.Justia.com Decay of IVI Based on Underlying Index U 300 250 200 ·U 150 .. IVI 100 50 o o 50 100 150 200 33 250 300 350
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