S (Spot Price of the Underlying) (interest rate) T (Maturity) 100.00 dollar 0.05 percent 2.00 years F (Forward Price) dollar A What is the futures price Fis higher 111 Position Now (t=0) Borrow cash equal St Buy the underlying at St Sell forward 100.00 -100.00 0.00 Value of Position at T Pay the loan back -110.52 Deliver ST 111.00 0 0.48 Fis lower B Chose an example where F is lower Position Now (t=0) Value of Position at T C Show how you can make an arbitrage trading strategy 0.00 0.00