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Recall that an FX rate XXXYYY = Bid/Offer gives the rate of YYY per XXX. You can buy XXX/sell YYY at the offer price

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Recall that an FX rate XXXYYY = Bid/Offer gives the rate of YYY per XXX. You can buy XXX/sell YYY at the offer price and sell XXX/buy YYY at the bid price. EURUSD is trading at 1.4760/1.4763 USDJPY is trading at 88.4/88.45 EURJPY is trading at 130.70/130.75 You have 10 million EUR. Find a trading strategy that generates a guaranteed profit and calculate how many EUR profit you can make, explaining the trades necessary to achieve this.

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Answer To generate a guaranteed profit we can use triangular arbitrage to t... blur-text-image

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