You are a retail investor. Looking at your Bloomberg terminal, you find the following quotes:

EUR/USD = 1.1141 - 43

GBP/USD = 1.3988 - 89

EUR/GBP= 0.9004 - 07

a)Compute the implied cross-rate for the EUR/USD

b)Are there any triangular arbitrage opportunities? If yes, how would you exploit them if you have $100,000 to invest?

Answer rating: 100% (QA)

a To compute the implied crossrate for the EURUSD we can use the exchange rates provided for EURUSD ... View the full answer