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What is actual forward contract or the synthetic forward

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Reference no: EM132479161

Question 1: Assume you want a short position in AUD in a 1-Year USD/AUD contract. You calculate the synthetic forward at FY1USD/AUD = 0.85 and your banker quotes you F1USD/AUD = 0.82. Do you choose the actual forward contract or the synthetic forward?

Group of answer choices

Option 1: Synthetic forward

Option 2: Makes no difference

Option 3: Do not have enough information to answer question

Option 4: Actual forward

Reference no: EM132479161

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