Forums › ACCA Forums › ACCA FM Financial Management Forums › Forward and money market hedging
- This topic has 1 reply, 2 voices, and was last updated 9 years ago by John Moffat.
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- October 23, 2015 at 9:32 pm #278632
Hey there!
I was trying to solve questions on forward and money market hedging and i came across such a scenario:
X Co is a UK co which frequently trades in high tech goods with USA based companies.The following imports and exports are due in 6 months time:
Halo Exports to Halo imports from
Co. A 150,000 1,000,000
Co.B nil 700,000
Co.C 500,000 400,000Exch rates $/Pound
Spot 1.9966-2.002
6 months forward 1.9711-1.9755Annual borrowing and investing rates available to Halo are:
Sterling upto 6 months 6.5% – 5.2%
Dollar upto 6 months 5.0% – 3.0%I totally don’t get how to solve this if you can assist please.
And, in such type of questions, should the workings be shown for each co. separately or merged?Will highly appreciate your help. Thanks 🙂
October 24, 2015 at 8:16 am #278676If you wish for me to answer, then you must ask in the Ask the Tutor Forum – this forum is for students to help each other.
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