nick123brown
New member
- Joined
- Apr 18, 2010
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Please help, I have to hand these answers in tomorrow and have pretty much no idea how to do this question, can anyone help me out?
nick123brown said:Please help, I have to hand these answers in tomorrow and have pretty much no idea how to do this question, can anyone help me out?
3. On the 1st of March the spot rate was 5.4 SKr/USD and the 4 month interest rates in USD and SKr were respectively 3.5% and 7.5%.
a) What should have been the quoted exchange rate on a June 30th futures contract?
b) Assume a contract was worth 500 000 SKr, what should have been the market value (in USD) of a June 30 futures contract?
c) If you expected to receive 2 million USD in 4 months, did you have to buy or sell futures contracts to hedge your position? How many?
4. On June 30th, you received the 2 million USD and settled your position. On that day, the spot rate was 5.52 Skr/USD and the market value of the futures contract was 89,285.7 USD. What was the value of the margin that you paid or received?