in $. per $
CHF. 0.8000 1.2500
1-month forward 0.8022 1.2466
3-month forward 0.8037 1.2442
6-month forward 0.7980 1.2531
6. If he takes a long position by buying CHF1 million 6-months forward, and if the actual spot rate 6 months later is S6($/CHF) = 0.8200, what would be his profit (loss)?
7. In that case, what would the transaction look like in 6 months? Would he give or receive CHF in exchange for $s? What would be the exchanged amounts?
8. If the actual spot rate in 6 months is $0.7721/CHF, what would be his profit (loss)?
9. In that case, what would the transaction look like in 6 months? What would be the exchanged amounts?
10. When using forward contracts, is the current spot rate between the two currencies relevant? Is the future, actual spot rate (when the forward contract matures) between the two currencies relevant?