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Basic Question 2 of 3

The expected reward on a carry trade is:

A. the gradual accrual of the interest rate differential that's unrelated to exchange rate volatility.
B. favorable exchange rate movements.
C. inflation differential.

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I was very pleased with your notes and question bank. I especially like the mock exams because it helped to pull everything together.
Martin Rockenfeldt

Martin Rockenfeldt

Learning Outcome Statements

describe the carry trade and its relation to uncovered interest rate parity and calculate the profit from a carry trade;

CFA® 2025 Level II Curriculum, Volume 1, Module 8.