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 00:50

Cool beans is a locally owned coffee shop that competes with two large coffee chains, planeteuro and frothies. alicia, the owner, hired two students to count the number of customers that entered each of the coffee shops to estimate what percent of people who are interested in coffee are visiting each shop. after a week, the students found the following results: 589 visited cool beans, 839 visited planeteuro, and 1,290 visited frothies. the students were surprised that cool beans had 139 visits on monday which represented 59% of all people who visited one of the three coffee shops on mondays. how many people visited one of the three coffee shops during the week?

Answers: 2

Answer

Business, 22.06.2019 05:20

Social computing forces companies to deal with customers as opposed to

Answers: 2

Answer

Business, 22.06.2019 07:30

Read the following scenario and answer the question in 5-10 sentences. you are the owner of a small business that is a defendant in a lawsuit in federal court. you received bad news from your lawyer that the judge did not allow certain documents to be admitted as evidence in court and that the jury reached a $50,000 verdict in favor of the plaintiff. your lawyer tells you that it is within your legal right to hire him to file an appeal with the united states court of appeals. if the appellate court rules in your favor, you may be able to avoid paying part or all of the $50,000. evaluate your lawyer’s suggestion about appealing the decision.

Answers: 1

Answer

Business, 22.06.2019 09:40

The relationship requirement for qualifying relative requires the potential qualifying relative to have a family relationship with the taxpayer. t or fwhich of the following is not a from agi deduction? a.standard deductionb.itemized deductionc.personal exemptiond.none of these. all of these are from agi deductions

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