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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.( ^; f* `5 M+ q# u8 L. W, K0 J. f
CDs could have different ratings, AAA -> F,
^' `: w3 _* l- N8 O' l9 L- }6 T& Imore risky ones would have higher premium (interest rate) as a compensation for an investment.
6 P, k. x' ]* o! g. W0 H" ~main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,1 f% ^4 i" w% I( ?; K0 I
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
7 n# K/ t7 \: W: H$ a4 |% yAlso, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.0 {) H; t: d# q; h u2 d. \
similar to bonds, CDs trading in the secondary market have different value at different times,
! Z; e3 C0 e+ Znormally the value is calculated by adding it's principle and interest. 5 j& @0 @- [2 w1 n
eg. the value of the mortgage+the interests to be recieved in the future. 7 j0 p! C9 G5 R! x2 P
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.
( D5 o# K2 h4 C9 ?" w6 |6 c
+ f7 B8 Q" e2 q5 D9 z/ rim not quite sure if the multiplier effect does really matter in this case.
9 t: Q8 G: Y( i( K( nin stock market, it's the demand and supply pushing the price up/downwards., j3 S/ w( Q' R5 H
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,
- ~! Q: I* R A- n* jA's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
3 X9 l/ x# _* g: v; K4 MThe 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.
0 X" c& E: i) |but the value of their assets did really drop significantly.% S* h q' }1 N9 H% p2 S- F. i; U
) C1 y7 |- W& ^( m5 B9 _[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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