Reading 12 CFA curriculum / Example 3(4) and 3 (5)

CFA Level II Economics
#1

Hello,

As per the subject mentioned I am confused about when to use mid market spot rate and when to use just bid or offer as per the selling or buying base currency?

As in curriculum it is mentioned that in genral practice to use mid market spot exchange rate.

Thanks in anticipation

#2

i have the same question. when do we know to use the “mid-market spot rate”?

#3

Use mid market rates for forward pricing, covered and uncovered parities etc.

Use bid/ask for triangular arbitrage, cross rates, carry trades.

#4

Thanks! I will keep this in mind.