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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.
) K9 ]2 H, }1 k# t- U0 W" mCDs could have different ratings, AAA -> F,: M& F7 Y) c9 e2 p* N) m e( m* v: n
more risky ones would have higher premium (interest rate) as a compensation for an investment.1 h C3 L. \7 k. X- ~7 ?
main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,
" y: D* n% }( V4 \- ]8 b$ }. vin other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
3 O9 P E& B) d: G5 v+ Y$ a9 ]Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
7 f, Z4 M# Y$ ]similar to bonds, CDs trading in the secondary market have different value at different times,( i! p& o- [1 [3 i) |+ Z9 ^2 C" _5 s( f
normally the value is calculated by adding it's principle and interest.
, P3 a" l% i4 A z6 i1 P$ ieg. the value of the mortgage+the interests to be recieved in the future. - h8 \' i) H2 g$ P8 F# n. u
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 Q$ f0 S* I3 V4 a) i4 t# x
$ n# a3 W9 H* N" x' V1 mim not quite sure if the multiplier effect does really matter in this case.
# b8 c2 n) y; P4 V) w' Ain stock market, it's the demand and supply pushing the price up/downwards.! z: M2 i1 L: A1 Q( Z! a" n" n
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,' p/ M1 g' f; i {! I
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
% {% q; | b9 P5 L, rThe 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.
# o9 o. J; g. p; r3 Ubut the value of their assets did really drop significantly.
- V% s- F5 `% |% r( g$ q6 `# Z0 X4 y! z# d
[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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