Getting Domestic Risk-Free Rate vs. Foreign Risk-Free Rate

CFA Level III
#1

Hi All-

Can someone please tell me under what hedging scenario would you end up getting the domestic risk free rate, and what scenario you’d get the foreign risk free rate?

Thanks in advance!

#2

if hedge both intl market and currency - you earn domestic Rf

If hedge just the intl market - you earn intl Rf

#3

thanks iteracom. I was fumbling there

#4

thanks!