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12#
發表於 2008-10-8 07:03 PM
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i thought it is the reason of rate of return.
* T- Q" R* L( C: ^2 KCDs could have different ratings, AAA -> F,: f" ^4 J4 v# O, g2 s
more risky ones would have higher premium (interest rate) as a compensation for an investment.
8 e* J6 p5 I3 k& ^+ g& X( V& Mmain reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,
2 ^( K2 m0 ^& Y$ r ~: bin other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.0 E& f5 G6 K( o }' R
Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.' x# H Y" m$ r1 J: J2 y
similar to bonds, CDs trading in the secondary market have different value at different times,% t' y; ~7 C1 [9 M2 L8 U
normally the value is calculated by adding it's principle and interest.
& a5 T1 q0 w2 g* v: Z. S% Heg. the value of the mortgage+the interests to be recieved in the future. " h% u/ y% L/ s, c G
banks who sell the CDs, could enjoy a few benefits like, the present value of cash and passing the risk of holding a debt to another party." G0 O W* {* K' G- f' s6 j
, e- j% q. ^: _5 U6 U0 i
im not quite sure if the multiplier effect does really matter in this case.
; b; w. _, U" Z% Ein stock market, it's the demand and supply pushing the price up/downwards.
3 h1 b: y2 L, s4 e3 uFor eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,
2 ^8 B- c8 ~2 {2 ]& N% vA's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
4 z( h$ M$ G$ `8 ~& d' |1 tThe capital loss that ppl suffer nowadays, i believe, most of them does not really suffer a real $ lost yet as long as they dont sell their securities. 2 y+ u1 W& v# X0 u/ U5 T* q7 U
but the value of their assets did really drop significantly.5 D: s, N! q7 w1 I
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[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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