Question

Assume the following information:

Exchange rate of Singapore dollar in USD = 0.32 USD/SGD

Exchange rate of pound in USD = 1.45 USD/GBP

Exchange rate of pound in Singapore dollars = 4.88 SGD/GBP

If you have 1 million USD to conduct one cycle of triangular
arbitrage, what will be your profit?

Answer #1

Step 1 | |||

Taking $1000000 and conevrt it to GBP | |||

USD | GBP | ||

1000000 | 689655.17 | [1 gbp = 1.45 usd] | |

Step 2 | |||

689655.17 GBP is converted to SGD Dollar | |||

GBP | SGD | ||

1 | 4.88 | ||

689655.17 | 3365517.241 | [1 gbp = 4.88 sgd] | |

step 3 | |||

Coverting SGD amount back to USD | |||

SGD | USD | ||

1 | 0.32 | ||

3365517.241 | 10,76,965.52 | ||

Now Initially we invested 1,000,000 | |||

Now, after 2 conversion, we have USD of 1076965.52 | |||

Hence Profit | 76965.51724 | (in USD) | |

(1076965.52 - 1000000) |

Assume the following information:
Exchange rate of Singapore dollar in USD = 0.32 USD/SGD
Exchange rate of pound in USD = 1.49 USD/GBP
Exchange rate of pound in Singapore dollars = 4.8 SGD/GBP
If you have 1 million USD to conduct one cycle of triangular
arbitrage, what will be your profit?

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Please show work

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