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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.0 ^7 q3 ?& h/ s4 a* L0 a
CDs could have different ratings, AAA -> F,
* A$ Z- q( `# kmore risky ones would have higher premium (interest rate) as a compensation for an investment.
, @+ i" E& u: i$ o2 u: smain reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,4 h. L8 ~$ w, F
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
& f! W1 F" r; z" `Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
) }' {# Y$ P$ A8 ^! O/ Z3 A! |. \6 Rsimilar to bonds, CDs trading in the secondary market have different value at different times,' `. s0 ?/ s6 X% r9 o
normally the value is calculated by adding it's principle and interest.
! h# |% G2 g" K, v* y0 xeg. the value of the mortgage+the interests to be recieved in the future. * Q2 U% {* j( u% E5 D. H
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.8 @- l# T; h# S% r! p/ b4 B
( o. E# i6 z7 [' T3 t3 lim not quite sure if the multiplier effect does really matter in this case.
1 [9 `, H# |- R; m# g4 n9 Nin stock market, it's the demand and supply pushing the price up/downwards.9 I+ V9 U+ }! ~: k9 u B7 R
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,- A: O7 D2 q$ H5 s4 y9 X" \7 F
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.6 ~ s/ V, W+ }& [9 ]( k! E- `
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. 8 |5 k+ @, l5 z& t
but the value of their assets did really drop significantly.. t- t: q1 K# O
; p- d4 L! D& F; p8 M! B[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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