Problem 7.01 – Tony Begay at Saguaro Funds
Multinational Business Finance
Eiteman, Stonehill, and Moffett
15th Edition
Determine the value of Tony’s position if Tony buys or sells a certain number of contracts on the British pound.
Determine the value of Tony’s position if Tony buys or sells a certain number of contracts on the British pound.
Yize Shen is a trader at Sumatra Funds in Jakarta, and she focuses on the USD to SGD cross-rate. She believes that SGD will appreciate against USD, and she has the following options to choose from… Given a table with put and call options, determine which option to purchase, the breakeven price, gross profit, and net profits at various future expected spot rates.
Given the current exchange rate between the USD and the SGD, along with a table conveying information about put and call options on the SGD, you are asked to decide which kind of option should be purchased by Yize Shen. Finally, you are asked to compute the gross profits and net profits at various spot rates at the end of 90 days.
Determine the value of the person’s position given various spot rates at maturity of the futures contracts.
Help Christoph Hoffeman speculate on the euro by buying or selling euros in the spot and forward markets. Answer the two concept questions based on the numbers provided.
Given a table with put and call options, determine which option to purchase, the breakeven price, gross profit, and net profits at various future expected spot rates.
Calculate Christoph Hoffeman’s expected profit if he uses a pure spot market speculation strategy and if he buys or sells Swiss francs three months forward.
Determine what Christoph should do based on his expected spot rate by answering two lengthy multiple-choice questions with a lot of text.
Given a table of British Pound Futures for March and June, evaluate Begay’s position if she buys or sells a certain number of pound futures.
Determine Christoph’s expected profit from a pure spot market speculation, and also if he buys or sells SF forward.