Help with an interview question

Hi

I have recently been asked the following interview question

*Assume you're the head of an FX desk at a large Bank. The following are the three scenarios which could be at play

Assume Spot for USD-THB is 34

Scenario 1 : Expected Change : + or - 3% change over the year Scenario 2: Expected change : + or - 15% change over the year Scenario 3: Expected change : + or 80% in a week (basically very very volatile scene)

Which one as the head of FX desk will you be most comfortable in? *

I initially answered traders love volatility. So it looks like scenario 3 is a good scenario. I usually know a few things from the perspective of a trader. But here the question was from the Perspective of head of a trading desk.

Can someone please answer this in detail?

1 Comments
 

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