The current spot rate of the Singapore dollar (S$) IS $0.50 USD/S$. The following option information is available:

-Euro call option premium on Singapore dollar (S$) =$0.02USD

-Euro Put option premium on Singapore dollar (S$) =$0.01USD

-Euro call and put option strike prices =$0.55USD

Contract size of the underlying asset:S$ 1,000,000 singapore dollar

Expiration date: December 21, 2018

If you firm has a subsidiary firm in Singapore and your firm expects to receive S$1,000,000 singapore dollar earnings remitted from the subsidiary three months later (dec 1, 2018). which option contract can help you hedge the foreign exchange rate risk in converting the Singapore dollar into the US dollar?

Draw a diagram for a long position in the call option and a long position in the put option respectively . On the diagram, show the strike price, breakeven price and the premium cost for each option contract.