Compute the profit from triangular profit if the bid and ask rate for yen and euro are 130yen/euro, 140yen/euro, and for US$ and euro are 0.8euro/US$ and 0.9euro/US$, and for US$ and yen are 100yen/US$, and 90yen/US$. Compute the triangular arbitrage profit if the notional sum is $1,000. a. Euro 40 b. $1,040 Yen 1,040.00 d. $40.00 C.

Compute the profit from triangular profit if the bid and ask rate for yen and euro are 130yen/euro, 140yen/euro, and for US$ and euro are 0.8euro/US$ and 0.9euro/US$, and for US$ and yen are 100yen/US$, and 90yen/US$. Compute the triangular arbitrage profit if the notional sum is $1,000. a. Euro 40 b. $1,040 Yen 1,040.00 d. $40.00 C.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

You observe the following quotations: USD/NZD = 1.3705 – 40 USD/GBP = 0.7130 – 60 GBP/NZD = 1.9340 – 80 Starting with £10,000, you can make one-trip arbitrage profits (rounded to the pound) of: 78 GBP 104 GBP No arbitrage profit is possible. 5 GBP 36 GBP
Suppose you observe the following direct spot quotations in New York and Toronto,respectively: USD 0.8000-50 and CAD 1.2500-60. What are the arbitrage pr()fits per USD Imn?
The graph below shows contingency net profits for a buyer of a Swiss franc (CHF) straddle, in which the exercise price is $1.09 per CHF, the call and put premiums are $0.03 and $0.04 per CHF, respectively. Explain why the buyer's net profit per unit is V-shaped, and why his break-even points are at the future exchange rates of $1.02 and$1.16. Net profit per unit S1.09 $1.02 $1.16 S1.09 Future spot rate -$0.07
If the spot rate is NZ$0.50/$ and the forward rate is NZ$0.55/$. The spot exchange rate and the forward rate are C$1.03/$ and C$1.07/$. Compute the percentage change in the NZS/C$ during this period. a. -5.89% b. 5.89% c. -5.56% d. 5.56%
Assume a risk-free asset in the U.S. is currently yielding 2.7 percent while a Canadian risk-free asset is yielding 2.8 percent and the current spot rate is Can$1.2849 = $1. What is the approximate 6-month forward rate if interest rate parity holds? Can$1.2855 Can$1.2838 Can$1.2843 Can$1.2862 Can$1.2836
M7 Q5 A
If one euro buys 1.13 U.S.? dollars, how many euros can you purchase for 12 U.S dollars? (Round to four decimal places.) OA. 1.0942 euros B. 6.2992 euros O C. 10.6195 euros OD. None of these.
The EUR/USD quotes 1.1295-1.1305 and you implement a long position for 100,000 €. 2 days later the EUR/USD shows 1.1431-1.1441. What is your P&L? a)1260 $ b)1460 $ c)1260 € d)1460 €
Based on the following table. Bid Ask EURUSD 1M FWD 7.05 7.34 EURUSD 2M FWD 14.99 15.15 EURUSD 3M FWD 22.57 23.05 EURUSD 4M FWD 30.25 30.55 EURUSD 5M FWD 38.03 38.43 EURUSD 6M FWD 45.91 47.2 EUR/USD Spot 1.1618 1.1624 What is the average annualized forward premium/discount for the EUR if you use the 6M forward contract (Format for answer: X.XX% or –X.XX%)
2. Judge whether the following price terms are correct or not. If not, make corrections (1) RMB55 per ton CIFC5 Shanghai (2) Pound 200 per carton CFR New Zealand (3) FF 150 per ton FOB New York
For a call option of CN¥100,000 with the $0.16 exercise price and $0.0005 premium, When the spot exchange rate is $0.1602, the profit from exercising the call (in total) is US$

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS