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Maria Cadiz, a foreign exchange trader in Madrid, sees that the 180-day forward rate for the Japanese yen against the dollar is 130/$. She believes
Maria Cadiz, a foreign exchange trader in Madrid, sees that the 180-day forward rate for the Japanese yen against the dollar is 130/$. She believes that the spot yen in six months will be stronger, at 125/$. What would be her expected profit on a 180-day forward speculation with $1 million? What would be her risks?
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