Subject: International Financial Management

Please explain in detail. Thank you in advance:)

(a) Suppose a trader takes a position on June 5th 2021, in one September 2021 EURO (EUR) future contract at USD1.3094/EUR. The trader holds the position until the last day of trading when the spot price is USD1.2939/EUR. This will be the final settlement price because of price convergence. The trader has EUR125,000 for this investment. (i) If the trader had a long position and he was a speculator, calculate his profit or loss for the position above. (2 marks) (ii) If the trader had a short position and he was a speculator, calculate his profit or loss for the position above. (2 marks) (ii) If the trader had a long position and he was a hedger, calculate his profit or loss for the position above. (3 marks) (iv) If the trader had a short position and he was a hedger, calculate his profit or loss for the position above