The current spot price of gold is $1280 per ounce. The forward price for 1 year delivery is $1400. Suppose an investor can borrow at 3% per year (simple interest). How can the investor make a riskless profit (assuming there is no cost or benefit to storing gold).

Answer rating: 100% (QA)

To make a riskless profit in this scenario the investor can use a strategy called arbitrage Arbitrag... View the full answer