Covered Interest Arbitrage Illustration 5
USD/CAD 1.1630, 3 months forward 1.1675. Annualized interest rate CAD 6% – USD 4%.Workout the arbitrage possibilities. (Oct. 2007)
(Ans.: Borrow Foreign (USD) Invest Home (CAD), Gain 10,878)
Covered Interest Arbitrage Illustration 5
USD/CAD 1.1630, 3 months forward 1.1675. Annualized interest rate CAD 6% – USD 4%.Workout the arbitrage possibilities. (Oct. 2007)
(Ans.: Borrow Foreign (USD) Invest Home (CAD), Gain 10,878)
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