The 6-month Japanese yen futures contract has a contract size of 12,500,000 and a price of...
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The 6-month Japanese yen futures contract has a contract size of ¥12,500,000 and a price of $0.94 per 100%. Part 1 Attempt 1/3 for 10 pts. If you expect the spot price to be $0.905 per 100% 6 months from now, what speculative position should you enter to profit from your expectation? O Sell Japanese yen in the futures market Sell Japanese yen in the spot market now Buy Japanese yen in the spot market now Buy Japanese yen in the futures market There is no profitable speculative position Correct ✔ Since you expect the spot price in 6 months to be less than the futures price, you should sell Japanese yen for $0.94 per 100¥ in the futures market and buy them in the spot market for $0.905 per 100% in 6 months. Attempt 1/3 for 10 pts. Part 2 If you trade 6 futures contracts, what is your profit (or loss) if your expectation turns out to be correct (in $)? p+ decimals The 6-month Japanese yen futures contract has a contract size of ¥12,500,000 and a price of $0.94 per 100%. Part 1 Attempt 1/3 for 10 pts. If you expect the spot price to be $0.905 per 100% 6 months from now, what speculative position should you enter to profit from your expectation? O Sell Japanese yen in the futures market Sell Japanese yen in the spot market now Buy Japanese yen in the spot market now Buy Japanese yen in the futures market There is no profitable speculative position Correct ✔ Since you expect the spot price in 6 months to be less than the futures price, you should sell Japanese yen for $0.94 per 100¥ in the futures market and buy them in the spot market for $0.905 per 100% in 6 months. Attempt 1/3 for 10 pts. Part 2 If you trade 6 futures contracts, what is your profit (or loss) if your expectation turns out to be correct (in $)? p+ decimals
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Number of contracts to trade to recover the amount of exposure will be Y 12500000 100 125000 contrac... View the full answer
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