What are your strategies and possible profit

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The current USD/HKD exchange rate is 7.60 HKD per USD. The six-month forward exchange rate is 7.85. The six-month HKD and USD interest rate is 1% and 3% per annum (annually compounded), respectively. If there is no transaction fee, is there any arbitrage opportunity? If yes, what are your strategies and possible profit?

Reference no: EM132020459

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