Currency Carry Trade Assignment
February 19th, 2020
A global macro investor implements a trading strategy solely based on the currency carry trade and decides to short sell three currencies based on the information below
Australia | Euro | Canada | Japan | New Zealand | Sweden | Switzer-land | UK | |
Annual interest rate | 4.87% | 2.13% | 2.73% | 0.06% | 5.19% | 2.90% | 0.25% | 3.73% |
GDP growth | 2.10% | 4.00% | 1.80% | 1.70% | 2.90% | 0.90% | 2.20% | 3.00% |
Debt to GDP | 20% | 70% | 40% | 140% | 33% | 60% | 50% | 60% |
Which three currencies will the investor short?
Group of answer choices
Australia, New Zealand, UK
Euro, New Zealand, UK
Euro, Japan, Sweden
Euro, Japan, Switzerland. Get Finance homework help today