Question
Assume that 90-day Canadian T-bills have a 4.5% annualized interest rate, whereas 90-day Swiss securities have a 5% annualized interest rate. In the spot market,
Assume that 90-day Canadian T-bills have a 4.5% annualized interest rate, whereas 90-day Swiss securities have a 5% annualized interest rate. In the spot market, 1 Canadian dollar (CAD) can be exchanged for 1.2 Swiss francs (CHF). If interest rate parity holds, what is the 90-day forward rate exchange between Canadian dollars and Swiss francs?
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Investment Analysis And Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown
9th Edition
0324656122, 978-0324656121
