Fisher Effect (CIP) Illustration 1


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Fisher Effect (CIP) Illustration 1

SGD 2.0749/EUR spot in Euroland interest rate 2.24% p.a. for 6 months.

SGD 2.0622/EUR 6 month Forward.

Compute annual interest rate in Singapore for 6 months to ensure no arbitrage possibilities.

(Ans.: 1%)


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