Question
Coleman Co., an Australian company, will pay 1.09 million Malaysian ringgit (MYR) to its' Malaysian supplier in one-year. To avoid transaction exposure, the company wants
Coleman Co., an Australian company, will pay 1.09 million Malaysian ringgit (MYR) to its' Malaysian supplier in one-year. To avoid transaction exposure, the company wants to take the money market hedge strategy using the spot rate A$0.3030/MYR and 6.69% deposit rate of MYR. What is the cost of money market hedge for Coleman Co. with 3.50% borrowing rate of A$?
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Introduces Quantitative Finance
Authors: Paul Wilmott
2nd edition
470319585, 470319581, 978-0470319581
