What range covers of your possible profits and losses

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Reference no: EM13897839

Suppose that the 90-day forward rate is $1.19 >:, the current spot rate is $1.20 > :, and you expect the future spot rate in 90 days to be $1.21 >:. What contract would you make to speculate in the forward market by either buying or selling :10,000,000? What is your expected profit? If the standard deviation of the 90-day rate of appreciation of the euro relative to the dollar is 3%, what range covers 95% of your possible profits and losses?

Reference no: EM13897839

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