Question
You are a foreign exchange arbitrageur and observe the following spot exchange rate quotes against the US dollar: USDJPY = 110.45 51 USDCHF = 0.9291
You are a foreign exchange arbitrageur and observe the following spot exchange rate quotes against the US dollar:
- USDJPY = 110.45 51
- USDCHF = 0.9291 97
Furthermore, a cross-exchange rate dealer is making the following quote:
- CHFJPY = 117.78 86
Given the above quotes, if you had $10,000 to speculate, how much profit would you earn (to the nearest $10) from exploiting a triangular arbitrage opportunity?
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Corporate Finance A Focused Approach
Authors: Michael C. Ehrhardt, Eugene F. Brigham
8th Edition
0357714636, 9780357714638
