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Triangular arbitrage You have $1 million. 6.75 Dkr/$ and 0.75 /$ in New York 8.9 Dkr/ in London Ignore any brokerage fees Implied cross exchange
Triangular arbitrage
- You have $1 million.
- 6.75 Dkr/$ and 0.75 /$ in New York
- 8.9 Dkr/ in London
- Ignore any brokerage fees
Implied cross exchange rate (Dkr/) in New York is ____________ Dkr/.
Strategy for this arbitrage is to _________ (buy or sell) Dkr in London _________ (buy or sell) Dkr in New York.
Profit from the arbitrage is $_____________.
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