Which of the Following Is Not a Method of Forecasting

question 30

Multiple Choice

Which of the following is not a method of forecasting exchange rate volatility?

• A) Using the absolute forecast error as a percentage of the realized value to improve your forecast.
• B) Using the volatility of historical exchange rate movements as a forecast for the future.
• C) Using a time series of volatility patterns in previous periods.
• D) Deriving the exchange rate's implied standard deviation from the currency option pricing model.

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