Samuel break-even spot rate

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Samuel Samosir works for Peregrine Investments in Jakarta, Indonesia. He focuses his time and attention on the U.S. dollar/Singapore dollar ($/S$) cross-rate. The current spot rate is $1.39/S$. After considerable study, he has concluded that the Singapore dollar will appreciate versus the U.S. dollar in the coming 90 days, probably to about $1.44/S$. He is considering trading options to profit and  has the following options on the Singapore dollar to choose from:

Option choices on the Singapore dollar:

Call on S$

Put on S$

Strike price (US$/Singapore dollar)

$1.35

$1.37

Premium (US$/Singapore dollar)

$0.047

$0.006

Samuel decides to sell put options on Singapore dollars. What will be Samuel's break-even spot rate (in direct format)? Keep all decimal numbers. Please just type in the number without the currency signs. For example, if your answer is $1.25/S$, then type in 1.25 as your final answer. 

Reference no: EM133056634

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