Assume that Brian Co. will need to purchase 100,000 Singapore dollars (S$) in 180 days. Todays spot rate of the S$ is $.50, and the 180day forward rate is $.53. A call option on S$ exists, with an exercise price of $.52, a premium of $.02, and a 180day expiration date. A put option on S$ exists, with an exercise price of $.51, a premium of $.02, and a 180day expiration date. Brian has developed the following probability distribution for the spot rate in 180 days:

Possible Spot Rate

in 180 Days Probability

$.48 10%

$.53 60%

$.55 30%

The probability that the forward hedge will result in a higher payment than the options hedge is _______ (include the amount paid for the premium when estimating the U.S. dollars required for the options hedge).

	0%
	10%
	30%
	70%