Consider a trader who takes a long position in a six-month futures contract on the euro. The

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Consider a trader who takes a long position in a six-month futures contract on the euro. The forward rate is $1.75 = €1.00; the contract size is €62,500. At the maturity of the contract the spot exchange rate is $1.65 = €1.00.

a. The trader has lost $625.

b. The trader has lost $6,250.

c. The trader has made $6,250.

d. The trader has lost $66,287.88

Related Book For answer-question

Introduction to Derivatives and Risk Management

ISBN: 978-1305104969

10th edition

Authors: Don M. Chance

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Posted Date: Nov 12, 2018 09:17 AM

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Consider a trader who takes a long position in a six-month futures contract on the euro. The

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Introduction to Derivatives and Risk Management

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