Should you buy or sell euros

Reference no: EM13280436

U.S Treasuries have an interest rate of 2% annualized. French Sovereign Debt has an interest rate of 5% annualized. The Euro currently trades at $1.35. What would be the expected 90 day forward exchange rate between the Euro and the dollar? You have checked with your FX dealer and the 90 day forward on the Euro is $1.40. Do you have an arbitrage opportunity? Should you buy or sell Euros?

Reference no: EM13280436

Questions Cloud

What required return must investors be demanding on ontario : Ontario Wine just paid a dividend of $1.50 on its stock, which currently sells for $50 per share. What required return must investors be demanding on Ontario Wine stock?

Compute delta h for the reaction at 298k : Calculate delta H for this reaction at 298K. Calculate delta G for this reaction at 298K. Calculate delta S for the reaction, for the surroundings, and the total delta S.

Things that they should all have running computers and up to : When you think about a good education, what do you think about? Do you think that things that they should all have running computers and up to date software?

Find the mass of the boxcar : A boxcar of mass 5.32 x 10^4 kg is rolling south at 3.49 m/s when it collides and couples with another boxcar that is rolling north at 5.12 m/s. Find the mass of the boxcar

Should you buy or sell euros : You have checked with your FX dealer and the 90 day forward on the Euro is $1.40. Do you have an arbitrage opportunity? Should you buy or sell Euros?

Find out what it takes to qualify for a loan : Select a financial institution and find out what it takes to qualify for a loan. Try to understand the rationale for the institution's rules, policies, and guidelines about loan approval.

Explain the standard molar entropy sm for the solid : Assume that a solid has a constant of Cp,m=25 J/K-mol from 50K to 298K and that the DeBye approximation is valid from 0K to 50K. Estimate the standard molar entropy Sm for the solid at 298K.

What is your mass on mercury : The planet Mercury has a mass of 3.3x10^23 kg and a radius of 2440 km. what is your mass on Mercury

Find the max instantaneous power delivered by the source : Find the max instantaneous power delivered by the source, dissipated by R, and absorbed by L. What are the smallest instants (t > 0) at which these maxima occur.

User Account

All Pages