Dr. Muayad Taysir Abdullah Al Hinai worked in Al Jadeed Exchange LLC from the year 16th February 2007 till 31" March 2020. Due to the impact of COVID 19, he decided to make advantage of the market fluctuations by actively trading in some of the major currency based on her real time experience gained in Al Jadeed Exchange LLC. Apart from that, he decided to hire a Forex Management student from Higher College of Technology (HCT), Al Khuwair named Mr. Hamed Ali Salim Al Mukhaini to give the necessary inputs pertaining to the market based on the following information: 

By ignoring the transaction costs, you are required to calculate the following details: 

a) Does Dr. Muayad Taysir Abdullah Al Hinai have Arbitrage opportunity for all the Options? 

b) Calculate the Arbitrage Profit or Loss based on these quotes for all the Option 31 and Option 32?

c) Dr. Muayad Taysir Abdullah Al Hinai has USD 5 Million available for this purpose. What will be her best suitable Options from the above?

Transcribed Image Text:

Option: 31 1.4248/USD SGD 4.5809/KWD SGD KWD 0.3111/USD Option: 32 PHP 163.2372/KWD PHP 50.7704/USD KWD 0.3111/USD Option: 31 1.4248/USD SGD 4.5809/KWD SGD KWD 0.3111/USD Option: 32 PHP 163.2372/KWD PHP 50.7704/USD KWD 0.3111/USD

Answer rating: 100% (QA)

B D E G H a 1 2 3 4 5 Option 31 SGD KWD 45809 KWD USD 03111 So SGD KWD KWD USD 45... View the full answer