Presently, the spot rate is Rs 44.50/US $. A speculator feels that, after a week, US dollar should appreciate to Rs 44.60. What should he do if he has Rs 10,000 at his disposal?
A pound options call contract has strike rate of $ 1.820/£ and a premium of $ 0.08. Spot rate on maturity is $ 1.830/£. Find gain/loss to options buyer/options seller.
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