If you sell USD 3-month forward to a client against EUR, what should you do to hedge your position?
A) Buy a 3-month EUR/USD outright forward
B) Buy USD spot, and sell and buy a 3-month EUR/USD FX swap
C) Sell EUR/USD in the spot market, lend EUR for 3 months and borrow USD for 3 months
D) Sell EUR/USD in the spot market, borrow EUR for 3 months and lend USD for 3 months
Correct Answer:
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