Question On hedging Carry Trade with currency futures

S

scalpmaster

If I long, say USD/JPY, for the interest differential
in 100X leverage SPOT FX, can I hedge it exactly by
shorting USD/JPY currency futures so I do not have
to worry about exchange fluctuations?

What's the catch/consideration??
:confused:
 
the futures contract is fixed in size so you would need to calculate precisely the amounts. plus the interest rate differential should be more or less equal. whathever you make in one trade you will be 'paying' in the other. the interest carry is in built on the futures contract pricing
 
Quote from scalpmaster:

If I long, say USD/JPY, for the interest differential
in 100X leverage SPOT FX, can I hedge it exactly by
shorting USD/JPY currency futures so I do not have
to worry about exchange fluctuations?

What's the catch/consideration??
:confused:
More...
:D :cool: :D
 
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