ZUBER INC USING COVERED INTEREST ARBITRAGE

ZUBER INC USING COVERED INTEREST ARBITRAGE



ZUBER INC USING COVERED INTEREST ARBITRAGE

The overall uncertainty about the exchange rates is perhaps the most potent risk in this case. Latvia had recently eased the strong controls over its economy, after the iron curtain of 1989. Covered interest arbitraging of at least some portion of the total exposure must be present. The picture that has been painted by the local Latvian bank which began to create a forward market for the local currency may be seen as a positive sign but one must take the inherent risks into ...