Question
Assume that there is no transaction cost and you observe the following quotation: 1. USD/HKD: 0.1250 2. JPY/USD: 116.20 3. HKD/JPY: 0.062 Assuming that you
Assume that there is no transaction cost and you observe the following quotation:
1. USD/HKD: 0.1250
2. JPY/USD: 116.20
3. HKD/JPY: 0.062
Assuming that you have HKD, the correct way to do triangular arbitrage is:
A.
from HKD buy JPY, then take JPY to buy USD, then take USD to buy HKD
B.
from HKD buy USD, then take USD to buy JPY, then take JPY to buy HKD
C.
from HKD buy USD, then take USD to buy JPY
D.
from HKD buy JPY, then take JPY to buy USD
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Personal Finance Turning Money Into Wealth
Authors: Arthur Keown
8th Edition
0134730364, 978-0134730363
