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發表於 2008-10-8 07:03 PM
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i thought it is the reason of rate of return.
7 P4 a3 p' ~0 \) N* H& ICDs could have different ratings, AAA -> F,
$ r5 i4 O, n+ n) k! h( Y" |more risky ones would have higher premium (interest rate) as a compensation for an investment.
' H5 E: O) W" Mmain reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,8 w5 h; v6 W E, S# n" x
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
% ?; \$ Y; [( xAlso, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.5 k# k/ a/ P A4 m6 P! S6 D
similar to bonds, CDs trading in the secondary market have different value at different times,
& N" F9 T5 ?' Snormally the value is calculated by adding it's principle and interest.
4 @6 R7 L* p9 x1 a3 c9 ^+ Yeg. the value of the mortgage+the interests to be recieved in the future.
4 V, @6 y! b1 M: x" K* ^1 t: m4 xbanks 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.
# i. c" B3 r7 t& R. Z7 z& k1 X
& f' c5 f! ]1 [2 y$ ~; k! |0 L: ]im not quite sure if the multiplier effect does really matter in this case.
1 |- V7 g& K' a( [9 A, hin stock market, it's the demand and supply pushing the price up/downwards.2 V& f+ z. p5 e
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,
. P) x8 ~; j* B" x: O- |, wA's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.- W7 [. L+ K! b, D6 Z
The 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.
7 |5 M0 M+ o6 @6 ~5 dbut the value of their assets did really drop significantly.3 v+ w' i; I; a, }0 `* Q
' y, d s! p9 a, c[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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