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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Buying or selling future fx contracts
Hi sir
If the spot rate is given as $/£1.5 and we are due to pay $2.3m in 6 months
I would assume that we need to buy now and sell later, as we are worried that the rate will increase, fair enough
But if the futures contracts are quoted as £/$, eg the inverse of the rate above, how do we deal with this when calculatin the lock in rate??
I assume we need all rates to be quoted in the same order eg $/£ or £/$??
Thanks
Yes – you need to invert the quotes if necessary to make sure they are both quoted in the same way.