NISMI: Lesson 4

Prateek is an exporter of Textiles. He has recently supplied an order, for which he would be receiving $10Million in 2 months time (payment in Dollar). Fearing that dollar may depreciate against the rupee, Prateek sold USDINR 2 month futures worth $10 million. Prateek is acting as a:

A ___________ tries to remove foreign currency risk on account of the nature of her business (export/ import) by making use of currency futures.

A hedger can reduce the volatility risk in future cash flows by making use of a currency futures trade. True or False?

An exporter of software to USA who is to receive payment after 2 months in USD, will always buy USDINR futures to hedge himself against an economic loss to his business, because of currency price movement. True or False?

An Indian importer, who imports material from Europe, and makes payment in EUR, expects EUR to weaken against the INR, in three months time when he will receive his payments. What would be his likely course of action to hedge his cash flow?

An Indian exporter, who exports textiles to UK, and receives payment in GBP, wants to hedge against currency volatility for the payment he is likely to receive after 3 months. What would be his likely course of action to hedge his cash flow?

Karthik Ltd is to receive $1Mln, after 3 months, against the exports of heavy engineering goods to a firm in USA. The USDINR spot price is Rs. 70, while the 3 months future is at Rs. 70.85. To hedge against the currency volatility, Karthik Ltd sold 1000 Lots of 3 month futures. 3 months later on the due date, the spot price was Rs. 68.00, while the Futures was at Rs. 68.50. What was his profit /loss from Futures?

A foreign currency trader, who does not have a real exposure to foreign currency risk is:

Samarth thinks that the Rupee is going to strengthen against the dollar for the next few days. Samarth therefore goes short on USDINR futures. Samarth is a

Preetam bought 10 lots of USDINR future at Rs.70.8750 when the spot price was Rs 70.50. After a few days, he sold 5 lots at Rs. 70.5450. What was his Profit/ Loss from the 5 lots that he sold?

Naushad bought 15 lots of EURINR future at Rs. 82.5725 when the spot price was Rs. 82.23. After a few days, he sold 10 lots at Rs. 83.3750. What was his Profit/ Loss from the 10 lots that he sold?

Ritu sold 10lots of JPYINR futures at Rs. 63.5025 when the spot price was Rs. 63.15. A few days later, when JPYINR future was trading at Rs. 63.2025, she bought back 6 lots. What was the profit/loss from the 6 lots that she bought back?

Ranjan sold 12 lots of EURINR future at Rs.82.5725 when the spot price was Rs.82.10. After a few days, he bought 10 lots at Rs 82.2275. What was his Profit/ Loss from the 10 lots that he bought?

Speculators add depth & liquidity to the currency futures market. True or False?

Ranjit identified a mispricing in the two different markets and makes a profitable trade. Ranjit is:

As more and more people identify mispricing in the currency market, the arbitrage opportunity reduces and market comes to an equilibrium. True or False?

The currency arbitrage opportunity can exist:

An arbitrager can make money by selling in the market where the price is ________ and buying in the market where the price is ______.

Despite the existence of arbitrage opportunities, it is difficult to make profit from such opportunities due to commissions & taxes. True or False?

The spot rate for USDINR is quoted at Rs. 70.20 and one month forward is at a premium of Rs. 0.30. The one month Future of USDINR is at Rs. 70.35. What is the arbitrage opportunity?

The spot rate for EURINR is quoted at Rs. 83.20 and one month forward is at a premium of Rs. 0.20. The one month future of EURINR is at Rs. 83.55. What is the arbitrage opportunity?

The spot rate for JPYINR is quoted at Rs.63.90. One month forward is at a discount of Rs.0.20. One month future is quoting at Rs. 64.00. What is the arbitrage opportunity?

The spot rate for JPYINR is quoted at Rs. 64.65. One month forward is at a discount of Rs. 0.30. One month future is quoting at Rs. 64.10. What is the arbitrage opportunity & what could be the arbitrage profit?

An Indian exporter, who exports goods to Germany and receives payments in EUR, 2 months after the delivery of goods, is concerned about EURINR risk. What describes his risk?

An Indian exporter, who receives payments in JPY for goods supplied to a Japanese company,3 months after the delivery of goods, is concerned about JPYINR risk. His risk is JPY appreciating against the INR. True or False?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD 50 each. They will receive the payment in 3months from date of delivery. They want to hedge the currency risk. USDINR spot price is Rs 71.25. The 3 month future of USDINR was at Rs 71.70. 3 month later, the day Satpal & sons received the payment the spot price was Rs 69.50 & the futures price was Rs. 69.70. For 50% hedging, what would the strategy be & how many contracts of USD were to be transacted by Satpal & sons?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD 50 each. They will receive the payment in 3 months from now. They want to hedge the currency risk. USDINR spot price is Rs. 71.25. The 3 month future of USDINR was at Rs 71.70. Three month later, the day Satpal & sons received the payment, the spot price was Rs 69.50 & the futures price was Rs. 69.70. If Satpal & sons, hedged completely, what is the value they received for the underlying trade transaction & what would have been the value 3 months prior?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD 50 each. They will receive the payment in 3 months from now. They want to hedge the currency risk. USDINR spot price is Rs 71.25. The 3 month Future of USDINR was at Rs 71.70. Three month later, the day Satpal & sons received the payment, the spot price was Rs 69.50 & the Futures price was Rs. 69.70. If Satpal & sons, hedged completely, what is the gain/loss in Futures market?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD50 each. They will receive the payment in 3 months from now. They want to hedge the currency risk. USDINR spot price is Rs 71.25. The 3 month future of USDINR was at Rs 71.70. Three month later, the day Satpal & sons received the payment, the spot price was Rs 69.50 & the futures price was Rs. 69.70. If Satpal & sons, had hedged only half of the quantity, what is the gain/loss in futures market?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD 50 each. They will receive the payment in 3 months from now. They want to hedge the currency risk. USDINR spot price is Rs. 71.25. The 3 month future of USDINR was at Rs. 71.70. Three month later, the day Satpal & sons received the payment, the spot price was Rs. 69.50 & the futures price was Rs. 69.70. What is the combined effect of change in spot prices and future prices?

Satpal & sons, an Indian exporter, are exporting shawls to US. They recently supplied an order for 20,000 shawls at USD 50 each. They will receive the payment in 3 months from now. They want to hedge the currency risk. USDINR spot price is Rs 71.25. The 3 month future of USDINR was at Rs 71.70. Three month later, the day Satpal & sons received the payment, the spot price was Rs. 69.50 & the futures price was Rs. 69.70. What is the effective price (per unit) after hedging if the budgeted price was Rs.71.25?

If the payoffs from Futures, are larger than payoffs from the business transaction, the effective price for an exporter would be:

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1 Million components at USD30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs. 69.75. The 3 month future of USDINR was at Rs 70.25. After 3 months, the day Kamalkant received the payment the spot price was Rs 71.50 & the futures price was Rs. 71.80. For 50% hedging, what would the strategy be & how many contracts of USD were to be transacted by Kamalkant?

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1Million components at USD30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs 69.75. The 3 month future of USDINR was at Rs 70.25. After 3 month, the day Kamalkant received the payment the spot price was Rs 71.50 & the futures price was Rs. 71.80. If Kamalkant, hedged completely, what is the value he received for the underlying trade transaction & what would have been the value 3 months prior?

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1 Million components at USD 30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs. 69.75. The 3 month future of USDINR was at Rs. 70.25. After 3 month, the day Kamalkant received the payment the spot price was Rs. 71.50 & the futures price was Rs. 71.80. If Kamalkant, hedged completely, what is the gain/loss in futures market?

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1 Million components at USD 30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs. 69.75. The 3 months future of USDINR was at Rs 70.25. After 3 month, the day Kamalkant received the payment the spot price was Rs 71.50 & the futures price was Rs. 71.80. If Kamalkant, had hedged only 1/3^rdof the quantity, what is the gain/loss in futures market?

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1 Million components at USD 30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs. 69.75. The 3 month future of USDINR was at Rs 70.25. After 3 months, the day Kamalkant received the payment the spot price was Rs 71.50 & the futures price was Rs. 71.80. What is the combined effect of change in spot prices and future prices?

Kamalkant, an Indian exporter, is exporting auto components to US. They recently supplied an order for 1 Million components at USD 30 each. He is to receive the payment in 3 months from date of delivery. He wants to hedge the currency risk. USDINR spot price is Rs.69.75. The 3 month future of USDINR was at Rs 70.25. After 3 months, the day Kamalkant received the payment the spot price was Rs. 71.50 & the futures price was Rs. 71.80. What is the effective price (per unit) after hedging if the budgeted price was Rs. 69.75?

An Indian importer, who imports goods from UK and makes payments in GBP, 3 months after the delivery of goods, is concerned about GBPINR risk. What describes his risk?

An Indian importer, who makes payments in USD for goods purchased from a company in USA, 3 months after the delivery of goods, is concerned about USDINR risk. His risk is USD appreciating against the INR. True or False?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. For 50% hedging, what would the strategy to hedge itself be & how many contracts of USD were to be transacted by Kiran Enterprises?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. If Kiran Enterprises, hedged completely, what is the value they paid for the underlying trade transaction & what would have been the value 3 months prior?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. If Kiran Enterprises, hedged completely, what is the gain/loss in futures market?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. If Kiran Enterprises, had hedged only 50% of the quantity, what is the gain/loss in futures market?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. What is the combined effect of change in spot prices and future prices?

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs.72.10 & the USDINR futures was Rs. 72.40. What is the effective price (per unit) after hedging?

If the payoffs from Futures are positive, the effective price for an importer would be:

Kiran Enterprises is a manufacturer of electrical appliances which imports a certain motor from US. It has purchased 1000 units of a motor at USD 200 per unit from its supplier. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 70.50 & 3 month future is at Rs.71.10. 3 months later, on the date of payment the spot price is Rs. 72.10 & the USDINR futures was Rs. 72.40. What is the effective price (per unit), if Kiran Enterprises have hedged only 50% of exposure?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. Three (3) months later, on the date of payment the spot price is Rs. 69.85 & the USDINR futures was Rs.70.40. For 60% hedging, what would the strategy to hedge itself be & how many contracts of USD were to be transacted by String Associates?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. 3 months later, on the date of payment the spot price is Rs.69.85 & the USDINR futures was Rs.70.40. If String Associates, hedged completely, what is the value they paid for the underlying trade transaction & what would have been the value 3 months prior?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD 120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month futures is at Rs. 72.95. Three (3) months later, on the date of payment the spot price is Rs. 69.85 & the USDINR futures was Rs. 70.40. If String Associates hedged completely, what is the gain/loss in futures market?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. Three (3) months later, on the date of payment the spot price is Rs.69.85 & the USDINR futures was Rs.70.40. If String Associates had hedged only 60% of the quantity, what is the gain/loss in futures market?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD 120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. Three (3) months later, on the date of payment the spot price is Rs. 69.85 & the USDINR futures was Rs. 70.40. What is the combined effect of change in spot prices and future prices?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. Three (3) months later, on the date of payment the spot price is Rs.69.85 & the USDINR futures was Rs.70.40. What is the effective price (per unit) after hedging?

String Associates is a manufacturer of televisions, which imports a certain picture tube from USA. It has purchased 15000 units of the picture tube at USD 120 per unit from its supplier based in USA. The payment is to be done in 3 months time in USD. The company wants to hedge its position against currency risk. At the time of purchase, the USDINR spot price is at Rs. 72.10 & 3 month future is at Rs.72.95. Three (3) months later, on the date of payment the spot price is Rs. 69.85 & the USDINR futures was Rs.70.40. What is the effective price (per unit), if String Associates have hedged only 60% of exposure?

Which of the following may not require the use of currency futures to hedge forex risk?

Sudeep is working in an Indian firm in Delhi for last 10 years. Sudeep invested Rs.1,00,000 in Gold when gold was trading at USD 900/Oz, a year back. Since then Gold price have increased 10% to USD 990/Oz. During the same time USD has appreciated against INR by 5%. Sudeep’s real return on Gold is:

Harkirat is working in an Indian firm in Bangalore for last 10 years. Harkirat invested Rs.10,00,000 in Gold when gold was trading at USD 1000/Oz, a few months back. Since then Gold price have increased by 10% to USD 1100/Oz. During the same time USD has depreciated against INR by 5%. Harkirat’s real return on Gold is

An Indian speculator expects international gold prices to move up in USD terms, in next 4 months. He, however, will purchase gold in domestic market. He wants to be hedged against the currency risk. What is his risk & what is the strategy to derisk?

Taneja, a commodity trader has bought 500 gms of gold at Rs. 28,000/10gm. He expects the INR to get strong for the next 6 months, after a spell of large decline in its value against USD. To hedge himself against currency risk, he sold USDINR futures at Rs. 70.00. After six months, the USDINR futures moved to Rs. 68, while gold prices moved up to Rs. 30,000/10gm. For a complete hedge, how many lots of currency futures did Mr. Taneja sell. What was his real return?

Sarika, a trader has bought 700 gms of gold at Rs.30,000/10gm. She expects the INR to get strong in the next 3 months, against USD. To hedge herself against currency risk, she sold USDINR futures at Rs. 70.00. After three months, the USDINR futures moved to Rs. 72, while gold prices moved up to Rs. 32,000. For a complete hedge, how many lots of currency futures did Ms. Sarika sell. What was the real return?

Navneet, a trader has bought 1.4 kg of gold at Rs.30,000/10gm. He expects the INR to get strong in the next 3 months, against USD. To hedge himself against currency risk, he sold USDINR futures at Rs. 70.00. After 3 months, the USDINR futures moved to Rs. 71, while gold prices moved up to Rs. 28,000/10gm. For a complete hedge, how many lots of currency futures did Navneet sell? What was the real return?

Zareen, a trader has bought 3.5 kg of gold at Rs. 30,000/10gm. She expects the INR to get strong in the next 6 months, against USD. To hedge herself against currency risk, she sold USDINR futures at Rs.70.00. After six months, the USDINR futures moved to Rs.67, while gold prices moved up to Rs.29,000/10gm. For a complete hedge, how many lots of currency futures did Zareen sell? What was her real return?

Shraboni, a trader has bought 600gm of gold at Rs.28,000/10gm. She expects the INR to get strong in the next 6 months, against USD. To hedge herself against currency risk, She sold USDINR futures at Rs. 70.00. After six months, the USDINR futures moved to Rs. 66, while gold prices moved up to Rs. 31,000/10gm. For a complete hedge, how many lots of currency futures did Shraboni sell? What was the real profit/loss?

An Indian professional buys a house for INR 50,00,000 for which payment has to be made after three months. As he is expecting to receive USD 70,000 in three months, he executes 72 USDINR futures contracts of 3 months maturity to hedge currency risk at a price of 72.00 for making the payment for the house and also settles the futures contract at a price of 70. Given this situation, would he have sold/bought USDINR futures while hedging the position?

Kranti has purchased US securities for 2000 USD a year ago when the USDINR was at Rs. 65. If the value of securities is now 3000 USD & USDINR is Rs.70, what are Kranti’s returns in USD?

Kranti has purchased US securities for 2000 USD a year ago when the USDINR was at Rs 65. If the value of securities is now 3000USD & USDINR is Rs.70, what are Kranti’s returns in INR?

Sumit has invested USD 50,000 in US equities. In an year, his investments in US equities grows to USD 75,000. Sumit decided to sell off his equity portfolio and repatriate the money and profits to India. At the time of investing, USDINR was at 68 and at the time of converting USD back into INR, the exchange rate was 70. How much is the return on investment in USD and in INR respectively?

Deepankar has invested USD 25,000 in US equities. At that time USDINR was at Rs. 60. In an year when Deepankar decided to sell his portfolio, the USDINR was at Rs. 70. If Deepanker earned 70% return on investment in INR, what is the return & value of portfolio in USD at the time of sale?

Ritika has invested USD 100,000 in US equities. At that time USDINR was at Rs.65. In an year when Ritika decided to sell her portfolio, the USDINR was at Rs. 70. If the value of Ritika’s portfolio was INR 110,00,000 at the time of sell off, what is the return & value of portfolio in USD at the time of sale?

Gaurav had invested in US equities a year back. He has just sold off his portfolio. From the given data, find X&Y?

Explanation:

Farhana had invested in US equities a year back. She has just sold off her portfolio. From the given data, find X & Y?

Mukherjee had invested in US equities a year back. He has just sold off his portfolio. From the given data, find X & Y?

Srinivasan had invested in US equities a year back. He has just sold off his portfolio. From the given data, find X,Y & Z?

Gulati has invested INR 20,00,000 in an 5 year Corporate FD, which gives a return of 20%, (simple interest), which is going to mature this year end. Mr. Gulati plans to use the proceeds from the maturity of FD to fund his son’s education in US at the end of the year. He requires a fund of USD 60,000 for college admission. A month before his son’s admission, USDINR is trading at Rs. 66. If it remains at Rs. 66 for the next month as well, what would be the excess / shortfall in USD for Mr. Gulati to finance his son’s education?

Mr. Gulati has invested INR 20,00,000 in an 5 year Corporate FD, which gives a return of 20%, (simple interest), which is going to mature this year end. Mr. Gulati plans to use the proceeds from the maturity of FD to fund his son’s education in US at the end of the year. He requires a fund of USD 60,000 for college admission. 3 months before his son’s admission, USDINR is trading at Rs.66. Mr. Gulati wants to remove the ambiguity of fund availability because of forex risk. What strategy would you suggest to him?

Mr. Gulati has invested INR 20,00,000 in an 5 year Corporate FD, which gives a return of 20%, (simple interest), which is going to mature this year end. Mr. Gulati plans to use the proceeds from the maturity of FD to fund his son’s education in US at the end of the year. He requires a fund of USD 60,000 for college admission. 3 months before his son’s admission, USDINR is trading at Rs.65. The 3 month future is trading at Rs.65.75. Mr. Gulati wants to remove the ambiguity of fund availability because of forex risk. He wants to buy USDINR Futures. 3 months later the spot price of USDINR is Rs. 68, while the futures is trading at Rs. 68.40. How many lots should he buy? What is the excess/ shortfall after the strategy (buy futures)?

A multinational company has been exporting to US and receives payment in USD. A large portion of the company’s raw materials are imported from Germany. The company uses large chunk of export revenue to pay for its imports (in EUR). The company is concerned about EURUSD risk for its import payments. Which of the following best describes company’s risk and the currency futures strategy that it may use to derisk itself?

An international firm exports to a US based firm and receives payment in USD. A large portion of the company’s raw materials are imported from Japan. The company uses a significant part of export revenues to pay its imports bill (in JPY). The company is concerned about USDJPY risk for its import payments. Which of the following best describes company’s risk and the currency futures strategy that it may use to derisk itself?

A trader has executed following currency futures trade: buys one lot of USDINR, sells one lot of EURINR. What view has he executed?

A trader has executed following currency futures trade: sells one lot of JPYINR, buys one lot of USDINR. What view has he executed?

Geeta, a trader firmly believes EURUSD will move from 1.12 to 1.20 in next 3 months. Which of the following would Geeta do to execute this view using currency futures contract of EURINR and USDINR?

Prateek, is speculating that USDJPY will move from 115 to 110 in next 3 months. Which of the following would Prateek do to execute this view using currency futures contract of JPYINR and USDINR?

Ramneek believes GBPUSD will move from 1.25 to 1.35 in next 3 months. Which of the following would Ramneek do to execute this view using currency futures contract of GBPINR and USDINR?

Jignesh expects EURUSD to move from 1.18 to 1.10 in next 6 months. Which of the following would Jignesh do to execute this view using currency futures contract of EURINR and USDINR?

Ashish believes GBPUSD will move from 1.15 to 1.08 in next 6 months. Which of the following would Ashish do to execute this view using currency futures contract of GBPINR and USDINR?

Abhijit is a currency arbitrager. He observed that one EURUSD is 1.15, while EURINR is 83.25. He also observed that USDINR was trading at 72.50. He figured out an arbitrage around USDINR. What is the arbitrage and profit from a lot?

Kailash is a currency arbitrager. He observed that one GBPUSD is 1.31, while GBPINR is 97.56. He also observed that USDINR was trading at 74.20. He figured out an arbitrage around USDINR. What is the arbitrage and profit from a lot?

Vartika is a currency arbitrager. She observed that one EURUSD is 1.15, while EURINR is 85.30. She also observed that USDINR was trading at 74.00. She figured out an arbitrage around USDINR. What is the arbitrage and profit from a lot?

Swapna is a currency arbitrager. She observed that one USDJPY is 113.1, while USDINR is 74.10. She also observed that JPYINR was trading at 66.00 (100 JPY) . She figured out an arbitrage around JPYINR. What is the arbitrage and profit from a lot?

Mayank is a currency arbitrager. He observed that one USDJPY is 115.00, while USDINR is 72.10. He also observed that JPYINR was trading at 63.00 (100 JPY). He figured out an arbitrage around JPYINR. What is the arbitrage and profit from a lot?

In forward market, one month USDINR is quoting at Rs. 70.20/70.40 and futures for same maturity is quoting at Rs. 70.80/70.90. What would be the arbitrage trade and arbitrage profit per USD if carried until maturity?

In forward market, one month EURINR is quoting at Rs. 83.55/83.70 and futures for same maturity is quoting at Rs. 84.25/84.35. What would be the arbitrage trade and arbitrage profit per EUR if carried until maturity?

In forward market, one month GBPINR is quoting at Rs. 91.35/91.45 and futures for same maturity is quoting at Rs. 92.20/92.35. What would be the arbitrage trade and arbitrage profit per GBP if carried until maturity?

In forward market, one month JPYINR per 100 JPY is quoting at Rs. 61.13/61.42 and futures for same maturity is quoting at Rs. 61.94/62.07. What would be the arbitrage trade and arbitrage profit per 100 JPY if carried until maturity?

In forward market, one month USDINR is quoting at Rs. 71.06/08 and future for same maturity is quoting at Rs. 70.77/70.80. What would be the arbitrage trade and arbitrage profit per USD if carried until maturity?

A calendar Spread consists of one long futures and one short futures contract, with same underlying but different maturities. True or False?

An inter–currency pair spread is a long position in futures of one underlying currency pairs and a short position of futures of another underlying currency, may or may not of same maturity. True or False?

Varsha, a currency arbitrager, observes that the USDINR June futures is trading at Rs. 72.35 & July futures is at Rs.72.45. The spread is relatively low between June & July month. She buys the July futures and sells the June future. A few days later, the June futures was trading at Rs. 72.75 & July futures was trading at Rs.73.20. She squared off her position. What was Varsha’s profit or loss from arbitrage per unit?

Vailash is a currency trader. He observes, a considerably large spread in EURINR futures of April at Rs. 82.30 & May at Rs 82.90. Expecting this spread to reduce, Vailash sells May future and buys April future. A few days later, he observes, April futures trading at Rs. 81.80 & May futures at Rs. 82.15. What was his profit loss from Arbitrage?

Shalini is a currency trader. She buys an April futures of GBPINR at Rs.93.45 & sells May futures at Rs 93.90. A few days later, she observes, April futures trading at Rs. 93.65 & May futures at 94.30. She squares off her positions, what was her profit/loss from Arbitrage?

From the data given below, what was the profitable arbitrage?

From the data given below, what was the profitable arbitrage?

If a person finds forward at 75.1 and future at 75.4. Which type of trade participant will trade to make profit?

Mr Karan finds 3 months USDINR futures at Rs. 71.20 and six months at 72.00. Mr. Karan had purchased a 3 month USDINR Futures at Rs.70.30 and sold 6 months USDINR Future at Rs.71.30, simultaneously, just a few days back. What is the profit/loss Mr. Karan is sitting on?

An _______________ consists of one long futures and one short futures with same underlying and different maturities.