User Account

All Pages

Make money with zero initial investment and no risk

Assignment Help Financial Management
Reference no: EM132014431

Suppose the spot $/Yen exchange rate is 0.008, the 1-year continuously compounded dollard enominated rate is 5% and the 1-year continuously compounded yen-denominated rate is 1%. Suppose the 1-year forward exchange rate is 0.0084. Explain precisely the transactions you could use (being careful about currency of denomination) to make money with zero initial investment and no risk. What is such a strategy being referred to in the markets?

Reference no: EM132014431

Questions Cloud

Calculate the free cash flow for big top : Calculate the free cash flow for Big Top for the most recent fiscal year.
What is one share of this stock worth to you today : What is one share of this stock worth to you today if you require a 14 percent rate of return?
What strategy you will apply to reap that profit : do you see any arbitrage profit opportunity in this case? If yes, what strategy you will apply to reap that profit?
What happens to the bond coupon rate and current yield : If relevant market yields decrease shortly after the Treasury bond is issued, what happens to the bond’s coupon rate, current yield, and yield to maturity?
Make money with zero initial investment and no risk : Explain precisely the transactions you could use (being careful about currency of denomination) to make money with zero initial investment and no risk.
What price of stock at expiry will allow you to break even : Explain with the help of a profit graph what price of the stock at expiry will allow you to break even?
What is the convenience yield : What is the cost of carry here? What is the convenience yield?
Corporation enters bankruptcy and liquidates assets : If a corporation enters bankruptcy and liquidates assets, seniority (i.e., which group gets paid first, second, and last) is as follows:
Its initial investment as salvage value : Assume that the shopping plaza will retain about 80% of its initial investment as salvage value.

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd