Kamada: CIA Japan (A). Takeshi Kamada, a foreign exchange trader at Credit Suisse (Tokyo) is exploring covered interest arbitrage possibilities. He wants to invest $5,000,000 or its yen equivalent, in a covered interest arbitrage between U.S. dollars and Japanese yen. He faced the following exchange rate and interest rate quotes, Is CIA profit possible? If so, how? Arbitrage funds available S 5,000,000 118.48 Spot rate (V/S) 180-day forward rate (V/S) 117.83 US dollar annual interest rate 4.805 % Japanese yen annual interest rate 3,396 % COD The CIA profit potential is, which tells Takeshi Kamada that he should borrow the U.S. dollar and invest in the higher yielding currency. the Japanese yen, to lock in a covered interest arbitrage (CIA) profit. (Round to three decimal places and select from the drop-down menus.)