270 day libor

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Kyle042678

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If I’m given 270 day libor and am asked to calculate a 270 day forward, do I need to adjust my rates by (270/360)? I think the answer is yes but I don’t see why. So is it a rule that you would always adjust libor rates regardless of how they are quoted?
 
Interest rates are always – always! – quoted as annual rates.
If they say that 270-day LIBOR is 4%, that’s 4% for one year: 360 days. It’s 3% for 270 days.
 
Thank you. Why is there such a thing as 270 day libor then?
 
Because the 270-day rate is different from the 180-day rate, and the 360-day rate, and the 90-day rate, and so on.
This wouldn’t be unusual:
  • 90-day LIBOR: 3.2% (0.8% for 90 days)
  • 180-day LIBOR: 3.6% (1.8% for 180 days)
  • 270-day LIBOR: 3.9% (2.925% for 270 days)
  • 360-day LIBOR: 4.1% (4.1% for 360 days)
 
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