page 492, Quants , Book 1, Official curriculum
question 3 - When we say “sell the CHF six months forward against the GBP” -->> are we saying we sell CHF 6 months from now to obtain GBP
please detail
I’m getting a bit confused with what bid/offer price to use for forward.
Kingfisher -
Set up your exchange rate so you’re always approaching your problems exactly the same way.
If the currency you’re buying or selling isn’t in the denominator of the quote you’re given, convert the quote.
As an investor you buy at the ask, which is the higher price. You sell at the bid, which is the lower price. (Otherwise, you could instantly make a profit.)
IMPORTANT: If you have to convert the quote you’re given, the bid becomes the ask of the converted quote. You’ll see why when you convert the quote of both the bid and ask you’re given.