Question
You are the finance manager of a company and currently your company has $100 million in cash that will not be needed for a few
You are the finance manager of a company and currently your company has $100 million in cash that will not be needed for a few more weeks. You are thinking about arbitrage opportunities using Euro and GBP in order to put the cash reserves into use and hopefully earn more money for your company. You have to make a decision about details of your arbitrage with regard to which currency to buy in which order. Check exchange rates, find current rates for USD, Euro, and GBP, and share the details of your arbitrage plan with your CEO. Is it poosible to find an arbitrage trade to generate some profits (assume you will have no trading costs)? If so, what should be the order of your transactions in order to make a profit from this arbitrage operations?
I received a response stating "need enough knowledge" and about "exchange rates". I am not sure what that means, please elaborate instead of 2-3 word responses.
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