Solved: Protect your portfolio from exchange rate risk, Finance Basics

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Protect your portfolio from exchange rate risk

Problem:

Suppose you own a portfolio of British securities valued at $430,000. The exchange rate is currently at $1 = £0.57. A currency contract on British pounds is set at 62,500 pounds. How many contracts must you purchase to protect your portfolio from exchange rate risk?

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Finance Basics: Protect your portfolio from exchange rate risk

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Finance Basics: Protect your portfolio from exchange rate risk

Reference No:- TGS02067018

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