LPoulin133

Its very tricky…the firm is invested in pounds so an appreciation of the pound/depreciation of the euro is a GOOD thing.
the appreciation of pound via interest rate parity ~ 0.75% . the managers expect appreciation of 0.35% (or depreciation of 0.35% of the euro).   thus, you hedge to lock in the 0.75% gain (remember they’re invested in pounds and wanna gain from the pound)
i got it wrong the first time, too…tricky question