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please find quick the profit of yen(the missing blank in question) thank you Kamada: UIA Japan (B). Takeshi Kamada, Credit Suisse (Tokyo). observes that the
please find quick the profit of yen(the missing blank in question)
Kamada: UIA Japan (B). Takeshi Kamada, Credit Suisse (Tokyo). observes that the Wi$ spot rate has been holding steady, and that both dollar and yen interest tales have remained relatively fixed over the past week. Takeshi wonders if he should try an uncovered interest arbitrage (UIA) and thereby save the cost of forward cover. Many of Takesh's research associates--and their computer models--are predicting the spot rate to remain dose to $118.00/5 for the coming 180 days. Using the data below, analyze the UIA potential Arbitrage funds available $ 4,950,000 Spot rato (5) 118.67 130-day forward rate (W$) 117.78 Expected spot rate in 180 days (WS) 118.00 U.S. dollar annual interest rate 4.795 % Japanese yen annual interest rate 3403% The LIA poctit potential is - 0.258%, which tolls Takeshi Kamada that he should borrow yon and invest in the higher yielding currency, the US dollar potentially gain on an uncovered basis (UIA) (Round to three decimal places and select from the drop-down menus) this expectations about the future spot rate, the one in effect in 180 days. prove correct, Takesh Kamada generates an uncovered interest arbitrage (UIA) profit of (Round to two decimal places) to thank you
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