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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.( y1 u: k6 v2 c# k! M; ?
CDs could have different ratings, AAA -> F,
0 z: A1 V* [2 @; x- W& M* h2 o0 _: u" Smore risky ones would have higher premium (interest rate) as a compensation for an investment.# y4 y0 p+ d" c- P7 n5 S- n0 P6 A P
main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,. w7 n* i( U0 p' Z3 ^
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.( a9 J; A" v3 l* K$ {
Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
* v& P: W) z+ Z# t6 vsimilar to bonds, CDs trading in the secondary market have different value at different times,
# l1 C+ j/ S% U0 S$ W6 d% S4 Dnormally the value is calculated by adding it's principle and interest.
- [8 [0 C$ }' @5 x7 ?. l7 n% Ceg. the value of the mortgage+the interests to be recieved in the future. $ a* f/ v) [5 O: \, s/ o' O) j
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.
( z' v/ W, X, j+ t; z$ X' O9 k- v6 L- p
im not quite sure if the multiplier effect does really matter in this case.
0 ]: y* x( S; P$ }5 q/ m" zin stock market, it's the demand and supply pushing the price up/downwards.- t/ {7 j* X% B n
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,8 K& y7 C6 [: v+ H4 u u3 K
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.) o0 @% C0 B. U( u8 W
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. ! y! V9 `, b# U
but the value of their assets did really drop significantly.
# d& {# \; d0 W9 _* c: g; ]6 q! }& p6 P* P9 a9 T8 c
[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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