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Hedging for a decrease in the value of Swiss francs

You are an arbitrageur in London. Swiss francs are presently selling in London for U.S. $0.67. You anticipate that they will increase in value and be selling for U.S. $0.70 in 30 days. You purchase $1 million worth of francs on the spot market. Is there anything that you can do to hedge your bet? That is, is there some way to ensure that you won't lose all of your money in case the value of the franc plummets?

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M9208195

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