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Rabaya (M) Bhd expects to receive 200 million in export payment from Japan in six months. The current spot rate is MYR3.2725/100 and the 180-days
Rabaya (M) Bhd expects to receive 200 million in export payment from Japan in six months. The current spot rate is MYR3.2725/100 and the 180-days forward rate is MYR3.2600/100. To mitigate the transaction risks, several information was provided by their bank for six-months forward as follows: Based on the above, justify the best hedging techniques for Rabaya (M) Bhd by comparing the revenues earned in the money market, forward market, and options contract. Rabaya (M) Bhd expects to receive 200 million in export payment from Japan in six months. The current spot rate is MYR3.2725/100 and the 180-days forward rate is MYR3.2600/100. To mitigate the transaction risks, several information was provided by their bank for six-months forward as follows: Based on the above, justify the best hedging techniques for Rabaya (M) Bhd by comparing the revenues earned in the money market, forward market, and options contract
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