Trading activities performed by financial institutions

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Reference no: EM131025890

a. A U.S. bank has made £50 million in Britain and has £40 in deposits. The bank's currency trading desk has also contracted to buy £20 million and has short positions of £15 million. What is the bank's net exposure? How could they use forward contracts to hedge the exposure? If the bank has exposures in euros and yen, would you recommend they use the forward hedge? Why or why not?

b. What are the major foreign exchanges trading activities performed by financial institutions?

Reference no: EM131025890

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