Mariko Fujimoto, a currency trader for Tokyo-based Sakura Bank, uses the following futures quotes on the British pound (£) to speculate on the value of the pound.

a. If Mariko buys 5 March pound futures and the spot rate at maturity is ¥139.95 = £1.00, what is the value of her position?

b. If Mariko sells 12 December pound futures and the spot rate at maturity is ¥138.90 = £1.00, what is the value of her position?

c. If Mariko buys 3 December pound futures and the spot rate at maturity is ¥138.90 = £1.00, what is the value of her position?

d. If Mariko sells 12 March pound futures and the spot rate at maturity is ¥139.95 = £1.00, what is the value of her position?

Transcribed Image Text:

British Pound Futures, Y= 1.00 (CME) Maturity Open High Low Settle Change High December 139.80 140.80 139.70 139.75 0.05 140.43 March 138.90 139.80 138.90 139.30 0.10 141.30 Contract 125,000 Open Interest 8,090 4,300