Consider the following quotes on the Israeli New Shekel (ILS) and the U S Dollar (USD) Spot exchange rate 3 months 6 months 9 months ILS3 05 3 13 USD ILS3 19 3 20 USD ILS3 31 3 45 USD ILS3 61 3 89 USD Suppose that you are a U S based trader and would like to enter a forward forward forex swap into Israeli New Shekel worth USD1,000,000 in three months time for six months Calculate and explain the cash flows associated with this swap transaction 30 Is the U S Dollar trading at a forward premium or discount Justify your answer clearly 10 hi i have attempted to solve this its just in class and other past paper we have done a much simpler case im thinking since we areswaping into ILS that we inevitably swap out of dollars that means we are selling dollars(dealer buys dollars bid rate) and like that we buy ILS then we need to do opposite if you can fully solve this question it will be very appreciated honestly i have spend so much time on this question

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Posted on Oct 04, 2024

Consider the following quotes on the Israeli New Shekel (ILS) and the U.S. Dollar (USD): Spot exchange rate 3-months 6-months 9-months ILS3.05-3.13/USD ILS3.19-3.20/USD ILS3.31-3.45/USD ILS3.61-3.89/USD

Consider the following quotes on the Israeli New Shekel (ILS) and the U.S. Dollar (USD):

Spot exchange rate	3-months	6-months	9-months
ILS3.05-3.13/USD	ILS3.19-3.20/USD	ILS3.31-3.45/USD	ILS3.61-3.89/USD

Suppose that you are a U.S.-based trader and would like to enter a forward-forward forex swap into Israeli New Shekel worth USD1,000,000 in three months time for six months. Calculate and explain the cash flows associated with this swap transaction. [30 %]

Is the U.S. Dollar trading at a forward premium or discount? Justify your answer clearly. [10 %]

hi i have attempted to solve this its just in class and other past paper we have done a much simpler case. im thinking since we areswaping into ILS that we inevitably swap out of dollars that means we are selling dollars(dealer buys dollars-bid rate) and like that we buy ILS then we need to do opposite. if you can fully solve this question it will be very appreciated honestly i have spend so much time on this question.