- This topic has 1 reply, 2 voices, and was last updated 9 years ago by
.
Viewing 2 posts - 1 through 2 (of 2 total)
- Posts
Sir just wanted to make things clear abt the rate used.why r the rate used for premium payable 1.3585,can .And for converting the amount not hedged we r using 1.3623 is
The premium is payable immediately and so we use the current spot rate for having to buy $, which is 1.3585.
If we want to cover the risk of the amount not hedged, then we use the current forward rate. Since the transaction is receiving $’s we use the forward rate for having to sell $’s.
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.