USE PESO JUNE FUTURES DATA PROVIDED with these At-Home problems ANSWER FOR PROBLEM SET 1 19pts total Selling Pesos QUIZ ENTRY $ 1. It is now May-4. At SPOT, what is the total US$ value of 5 million pesos? Sell? or Buy? $ 2. Your US firm will be selling 5m. Pesos on Jun.2 but will hedge using June Futures contracts against the US$ value being lower then. Your firm will SELL?? Or BUY?? Futures 3. What is the total $ value of 5 m. Pesos at May 4 Futures contract Price? $ 4. It is now Jun.2. At SPOT, what is the total US$ value of 5 million Pesos? Spot GAIN?? Spot LOSS?? $ 5. Selling the 5 m. Pesos at SPOT on Jun.2 (if did not hedge) versus Spot value on May 4 results in a GAIN?? OR LOSS?? in the Spot market for your US firm. 6 Calculate the total SPOT S amount of GAIN?/LOSS? if did not hedge with Futures Show GAIN as "+"S, LOSS as "-"$ $ $ 7. What is the total $ value of Sm. Pesos at the May 4 Jun.2 futures price? 8. A Futures hedge started on May 4, AS OF Jun.2, results in a futures GAIN?? OR LOSS?? Fut. GAIN? Fut. LOSS? $ 9. If you hedged with Futures on May 4, calculate the total amount of Futures GAIN?/LOSS? as of Jun.2. Show GAIN as " + "$, LOSS as "-"$ $ $ 10. Calculate your total $ NET Gain?/Loss? by combining the Jun.2 Spot Gain?/Loss? with the Jun.2 Futures Gain?/Loss?. Show GAIN as " + "S, LOSS as "-"$ This is the net result for your firm from using Futures hedge for selling 5 m. Peso on Jun.2 GENERAL: A proper hedge will combine a Spot Gain with Futs Loss, or a Spot Loss with Futs Goin JUNE FUTURES PRICE, S/Peso (BLUE) Daily Peso SPOT Price (RED) $0.0465 . $0.0455 $0.0445 DATE May 1 Maya Mays May 5 May 7 May. 11 May 12 May 13 May 14 May 15 May 18 May 19 May 20 May 21 May.22 May 26 May 27 May 28 May 29 lun lun und IUNE Mx PESO Futures Spot Price Price by date $ 0.0402 $ 0.0406 0.04099 0.0415 0.04159 0.0416 0.04095 0.041 0.0413 0.0416 0.04158 0.0418 0.0411 0.041 0.04083 0.0413 0.0414 0.0419 0.04148 0.0412 0.04196 0.0421 0.04177 0.04223 0.04317 0.04310 0.04346 0.0437 0.04381 0.044 0.04192 0.045041 0.04472 0.04483 0.04499 0.04503 0.04496 0.0451 0.04588 0.0459 0.04586 0.0459 0.04568 0.0456 0.04616 0.0463 0.04629 0.046513 0.0457 00456 0.04575 0.0457 004398 004324 0.04473 0.045 50.0435 $0.0425 $0.0415 50.0405 lun. lun. 50.0395 2 1.1 | | | 11 Mays May 4 Maya May 12 May 13 11 Stew May 22 May 20 May 21 May 19 May 28 May 23 May.22 un 10 May May 13 May 6 May May 11 USE PESO JUNE FUTURES DATA PROVIDED with these At-Home problems ANSWER FOR PROBLEM SET 1 19pts total Selling Pesos QUIZ ENTRY $ 1. It is now May-4. At SPOT, what is the total US$ value of 5 million pesos? Sell? or Buy? $ 2. Your US firm will be selling 5m. Pesos on Jun.2 but will hedge using June Futures contracts against the US$ value being lower then. Your firm will SELL?? Or BUY?? Futures 3. What is the total $ value of 5 m. Pesos at May 4 Futures contract Price? $ 4. It is now Jun.2. At SPOT, what is the total US$ value of 5 million Pesos? Spot GAIN?? Spot LOSS?? $ 5. Selling the 5 m. Pesos at SPOT on Jun.2 (if did not hedge) versus Spot value on May 4 results in a GAIN?? OR LOSS?? in the Spot market for your US firm. 6 Calculate the total SPOT S amount of GAIN?/LOSS? if did not hedge with Futures Show GAIN as "+"S, LOSS as "-"$ $ $ 7. What is the total $ value of Sm. Pesos at the May 4 Jun.2 futures price? 8. A Futures hedge started on May 4, AS OF Jun.2, results in a futures GAIN?? OR LOSS?? Fut. GAIN? Fut. LOSS? $ 9. If you hedged with Futures on May 4, calculate the total amount of Futures GAIN?/LOSS? as of Jun.2. Show GAIN as " + "$, LOSS as "-"$ $ $ 10. Calculate your total $ NET Gain?/Loss? by combining the Jun.2 Spot Gain?/Loss? with the Jun.2 Futures Gain?/Loss?. Show GAIN as " + "S, LOSS as "-"$ This is the net result for your firm from using Futures hedge for selling 5 m. Peso on Jun.2 GENERAL: A proper hedge will combine a Spot Gain with Futs Loss, or a Spot Loss with Futs Goin JUNE FUTURES PRICE, S/Peso (BLUE) Daily Peso SPOT Price (RED) $0.0465 . $0.0455 $0.0445 DATE May 1 Maya Mays May 5 May 7 May. 11 May 12 May 13 May 14 May 15 May 18 May 19 May 20 May 21 May.22 May 26 May 27 May 28 May 29 lun lun und IUNE Mx PESO Futures Spot Price Price by date $ 0.0402 $ 0.0406 0.04099 0.0415 0.04159 0.0416 0.04095 0.041 0.0413 0.0416 0.04158 0.0418 0.0411 0.041 0.04083 0.0413 0.0414 0.0419 0.04148 0.0412 0.04196 0.0421 0.04177 0.04223 0.04317 0.04310 0.04346 0.0437 0.04381 0.044 0.04192 0.045041 0.04472 0.04483 0.04499 0.04503 0.04496 0.0451 0.04588 0.0459 0.04586 0.0459 0.04568 0.0456 0.04616 0.0463 0.04629 0.046513 0.0457 00456 0.04575 0.0457 004398 004324 0.04473 0.045 50.0435 $0.0425 $0.0415 50.0405 lun. lun. 50.0395 2 1.1 | | | 11 Mays May 4 Maya May 12 May 13 11 Stew May 22 May 20 May 21 May 19 May 28 May 23 May.22 un 10 May May 13 May 6 May May 11