Question
You work as a currency trader at the Big Time Bank and specialise in trading the AUD USD. The current spot rate is USD AUD
You work as a currency trader at the Big Time Bank and specialise in trading the AUD USD. The current spot rate is USD AUD 0.678 and you have forecast a rate of USD AUD 0.6915 in 90 days. The borrowing and lending rates in Australia and the US are:
| Currency | Lending rate | Borrowing rate |
| US dollar | 2.3% | 2.5% |
| Australian dollar | 1.4% | 1.8% |
You will speculate on the change in the exchange rate and you have the authority to borrow $10 million of either currency.
a) Which currency will you borrow and which will you invest in? Explain why.
b) What is your profit in AUD? Show all calculations in detail.
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Fanatical Prospecting The Ultimate Guide To Opening Sales Conversations And Filling The Pipeline By Leveraging Social Selling Telephone Email Text And Cold Calling
Authors: Jeb Blount, Mike Weinberg
1st Edition
1119144752, 978-1119144755
