You decide to try the carry trade. The one-year interest rate in the eurozone is 5 % and 8 % in the US. The spot rate is

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answerhappygod
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You decide to try the carry trade. The one-year interest rate in the eurozone is 5 % and 8 % in the US. The spot rate is

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You Decide To Try The Carry Trade The One Year Interest Rate In The Eurozone Is 5 And 8 In The Us The Spot Rate Is 1
You Decide To Try The Carry Trade The One Year Interest Rate In The Eurozone Is 5 And 8 In The Us The Spot Rate Is 1 (15.85 KiB) Viewed 24 times
You decide to try the carry trade. The one-year interest rate in the eurozone is 5 % and 8 % in the US. The spot rate is €1.60 / $. You borrow €3 million for one year. If the spot rate in one year is €1.5378 / $, what are your profits / losses ?
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