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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.
( S* Y0 {9 M2 N+ b% Z9 V) sCDs could have different ratings, AAA -> F,
8 R0 _% K$ N5 O3 emore risky ones would have higher premium (interest rate) as a compensation for an investment.7 _, A' e+ P# O% C3 E
main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,0 Y8 l8 }5 d, g, [4 Z
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities./ n& n4 n) o: O+ Q' o# Z
Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
0 u( |& _2 B- K! p; B# }similar to bonds, CDs trading in the secondary market have different value at different times,
7 p( @- F* x. c- d3 K$ x) h2 unormally the value is calculated by adding it's principle and interest.
# ^# S$ l+ B, B1 t; ~# f* R) ]eg. the value of the mortgage+the interests to be recieved in the future. ) w1 R _1 @% j5 x: y
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.
1 [/ o" `6 o x/ i
! w" ]' G ?9 gim not quite sure if the multiplier effect does really matter in this case.
) {& a, Q% g! j r/ Y6 U% G, bin stock market, it's the demand and supply pushing the price up/downwards.
- u! C9 N! m3 S) @' E# U N4 [For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,
& o1 r; b f9 R8 IA's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
) O$ b5 [5 h2 U0 D' _- cThe 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. ; O. ~! a: w* r) r9 C
but the value of their assets did really drop significantly.
. [( T. f9 M* W; b. M7 \- _
& \* p W, L. g" ]* T7 y[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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