Business, 10.03.2020 16:32 AaronEarlMerringer

Your firm is a U. K.-based exporter of bicycles. You have sold an order to a Swiss firm for SFr. 1,000,000 worth of bicycles. Payment from the Swiss firm (in Swiss francs) is due in 12 months. Detail a strategy using futures contracts that will hedge your exchange rate risk. Have an estimate of how many contracts of what type and maturity.

U. S. $ equiv. Currency per U. S. $
Contract Size Country Tuesday Monday Tuesday Monday
£ 10,000 Britain (pound) $ 1.9600 $ 1.9400 £ 0.5102 £ 0.5155
1 month forward $ 1.9700 $ 1.9500 £ 0.5076 £ 0.5128
3 months forward $ 1.9800 $ 1.9600 £ 0.5051 £ 0.5102
6 months forward $ 1.9900 $ 1.9700 £ 0.5025 £ 0.5076
12 months forward $ 2.0000 $ 1.9800 £ 0.5000 £ 0.5051
€ 10,000 Euro $ 1.5600 $ 1.5400 € 0.6410 € 0.6494
1 month forward $ 1.5700 $ 1.5500 € 0.6369 € 0.6452
3 months forward $ 1.5800 $ 1.5600 € 0.6329 € 0.6410
6 months forward $ 1.5900 $ 1.5700 € 0.6289 € 0.6369
12 months forward $ 1.6000 $ 1.5800 € 0.6250 € 0.6329
SFr. 10,000 Swiss franc $ 0.9200 $ 0.9000 SFr. 1.0870 SFr. 1.1111
1 month forward $ 0.9400 $ 0.9200 SFr. 1.0638 SFr. 1.0870
3 months forward $ 0.9600 $ 0.9400 SFr. 1.0417 SFr. 1.0638
6 months forward $ 0.9800 $ 0.9600 SFr. 1.0204 SFr. 1.0417
12 months forward $ 1.0000 $ 0.9800 SFr. 1.0000 SFr. 1.0204
Go short 100 12-month Swiss franc futures contracts; and short 50 12-month pound futures contracts.

Go short 100 12-month Swiss franc futures contracts; and long 50 12-month pound futures contracts.

none of the options

Go long 100 12-month Swiss franc futures contracts; and long 50 12-month pound futures contracts.

Go long 100 12-month Swiss franc futures contracts; and short 50 12-month pound futures contracts.

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 21:10

Your family business uses a secret recipe to produce salsa and distributes it through both smaller specialty stores and chain supermarkets. the chain supermarkets have been demanding sizable discounts, but you do not want to drop your prices to the specialty stores. true or false: the robinson-patman act limits your ability to offer discounts to the chain supermarkets while leaving the price high for the smaller stores. true false

Answers: 3

Answer

Business, 22.06.2019 22:50

Wendy made her career planning timeline in 2010. in what year should wendy's timeline start? a. 2013 o b. 2012 oc. 2010 o d. 2011

Answers: 2

Answer

Business, 23.06.2019 02:30

Interview notes mike is 50 and made $36,000 in wages in 2017. he is single and pays all the cost of keeping up his home. mike's daughter, brittany, lived with mike all year. brittany's son, hayden, was born in november 2017. hayden lived in mike's home since birth. brittany is 25, single, and had $1,500 in wages in 2017. she is not disabled. mike provides more than half of the support for both brittany and hayden. mike, brittany, and hayden are all u.s. citizens with valid social security numbers. 4. who can mike claim as a qualifying child(ren) for the earned income credit?

Answers: 1

Answer

Business, 23.06.2019 04:00

Estimate the prouduct sovle using an area modelestimate the product you solve using an area model and the standard algorithm.remeber to express your products in the standard form

Answers: 3

Answer

You know the right answer?

Your firm is a U. K.-based exporter of bicycles. You have sold an order to a Swiss firm for SFr. 1,0...

Questions