User Account

All Pages

Can a swiss investor earn a guaranteed profit

Assignment Help Finance Basics
Reference no: EM13909969

Suppose cross rate arbitrage investors notice the following quotes:

Swiss franc/U.S. dollar =1.5971
Australian dollar/U.S. dollar =1.8215
Australian dollar/Swiss franc =1.1450

1. Ignoring transaction cost does a U.S. investor have an opportunity to earn a guaranteed profit? What actions would he have to take and what is his profit if any. He has $1,000,000 to invest.

2. Can a Swiss investor earn a guaranteed profit? What actions would he take and how much would be his profit. He has SF 1,597,100 to invest.

3. What SF/$ price will eliminate triangular arbitrage opportunity for a Australian investor?

Reference no: EM13909969

Questions Cloud

What criteria or expectations posed limitations to the plan? : What criteria or expectations posed limitations to the plan?
Grams of nitrogen gas from the combustion : Calculate the % yield from an experiment that produced 5.85 grams of Nitrogen gas from the combustion of 66.92 grams of CH3NH2 with 79.8 grams of O2 at 273°K and 1 ATM CH3NH2(g) + O2(g) → CO2 + N2 + H2O.
Role of the national health service corp : Rural Health Care has many issues that must be addressed; first explain the role of the National Health Service Corp (NHSC) and some of the efforts it makes and benefits it provides in recruiting doctors to a rural setting
Calculate the required sample size n : This indicates that the reasonable value for p that is closest to .5 is .57, and thus the largest reasonable value for p(1 - p) is .57(1 - .57) = .2451. Calculate the required sample size n.
Can a swiss investor earn a guaranteed profit : Ignoring transaction cost does a U.S. investor have an opportunity to earn a guaranteed profit? What actions would he have to take and what is his profit if any. He has $1,000,000 to invest.
Compute the gram molecular weight of dry air : Dry air is a mixture, by volume, of 78% nitrogen (N2), 21% Oxygen (O2) and Argon (Ar 40 g). a) Compute the gram molecular weight of dry air
Is the swap attractive to round rock national : Round Rock National's correspondent, Citicorp, offered to arrange a swap with $1,000,000 principal that would allow Round Rock to receive interest at 1% over LIBOR and pay at 1% over T-bill. Is the swap attractive to Round Rock National?
Determine the sample size needed so that we are confident : Determine the sample size needed so that we are 95 percent confident that pˆ, the sample proportion of voters who favor the candidate.
Balanced chemical equation for the reaction : Magnesium combines with chlorine, Cl2, to form magnesium chloride, MgCl2, during a synthesis reaction. Write a balanced chemical equation for the reaction.

Reviews

Write a Review

Finance Basics Questions & Answers

  Vance has a vested account balance in his

vance has a vested account balance in his employer-sponsored qualified profit sharing plan of 40000. he has two years

  How would the payment differ if you paid interest only

You wish to buy a $9,000 dining room set. The furniture store offers you a 3-year loan with an 10 percent APR. What are the monthly payments?

  What is park beta

The standard deviation of stock returns of Park Corporation is 60 percent. The standard deviation of the market return is 20 percent. If the correlation between Park and the market is 0.40, what is Park's beta?

  What is the internal rate of return of this project

DYI's required rate of return is 8%. What is the internal rate of return of this project?

  Fisher effect-us and euro inflation and currency rates

Assume that the U.S and the Euro nominal interest rate are equal. Subsequently, the U.S. nominal rate decreases while the Euro nominal interest rate remains stable.

  If the annual operating expenses will be 1 and the 12b-1

you pay 21600 to the laramie fund which has a nav of 18.00 per share at the beginning of the year. the fund then

  The firms annual sales are expected to total 3600000 its

zorn corporation is deciding whether to pursue a restricted or relaxed current asset investment policy. the firms

  Zhao automotive issues fixed-rate debt at a rate of 700

zhao automotive issues fixed-rate debt at a rate of 7.00. zhao agrees to an interest rate swap in which it pays libor

  Problem is stated at the start of the post

Find the simple interest on a loan of $8000 at 6% for 18 months. Problem is stated at the start of the post All work/explanation for assigned problem is shown Correct solution

  What is the interest rate that the investor locked in

On January 8, 2016, a bank wants to lock in the 3-month interest rate starting on June 20, 2017. The investor buys June2017 Eurodollar futures contracts at 96.53. What is the interest rate that the investor locked in?

  Aspect of using networking

Question 1: A key aspect of using networking as a career tactic is that a person should:

  Use the regular monthly payment formula

Calculate the monthly payment on a fixed-rate mortgage of $150,000, with 12% interest, over 30 years.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd