What would be the cash flow in one year from this arbitrage


MSFT currently trades for $45 per share and the riskless rate of interest is 3.5% per year continuously compounded. The futures price for a contract expiring in one year is $45 per share. Suppose that you construct a trade, as we did in class, to capture arbitrage profits with no initial investment. What would be the cash flow in one year from this arbitrage trade?

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Financial Management: What would be the cash flow in one year from this arbitrage
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