kyt 6/99

It is the difference between converting at the current spot and converting at spot on the date of the transaction. Hedging efficiency is explained in detail in the free lecture on futures. (The question did not ask for it. The examiner back 16 years ago did mention in his answers several time, but it is very unlikely that the current examiner will ever ask for it.)

It is the difference between converting at the current spot and converting at spot on the date of the transaction. Hedging efficiency is explained in detail in the free lecture on futures. (The question did not ask for it. The examiner back 16 years ago did mention in his answers several time, but it is very unlikely that the current examiner will ever ask for it.)

Thank u sir,i did look at the lecture and i know this difference,but i coulf calculate only 56238 not the other figure 74197, so please explain. Thanks

But I did explain in the first sentence of my previous reply! I repeat - the 74,197 is the difference between converting at the current spot (128.15) and the spot at the date of the transaction (120). Try converting at both rates and subtract one from the other.