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Imagine that you went long in a 366-day forward contract on 250,000 at $1.2625/. Thirty days later interest rates (per annum) are i=3.5%,i=5%, and i=7.1%
Imagine that you went long in a 366-day forward contract on 250,000 at $1.2625/. Thirty days later interest rates (per annum) are i=3.5%,i=5%, and i=7.1% while spot exchange rates are now S0($/)=$1.25/ and S0($/)=$1.50/. Within $1, what is the value today of your position in the forward contract
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Practical financial management
Authors: William r. Lasher
5th Edition
0324422636, 978-0324422634
