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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.
3 s( Q+ O( }5 ~/ oCDs could have different ratings, AAA -> F,
2 ~" m3 h2 r! P+ L) q: s vmore risky ones would have higher premium (interest rate) as a compensation for an investment.
2 ?4 ?6 s7 K- h emain reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,
0 s7 }: c$ F3 D, _7 I3 u; Din other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
& v' f9 I) y- g8 w b0 rAlso, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
9 P6 U2 N3 t2 C" i: h- w& T" zsimilar to bonds, CDs trading in the secondary market have different value at different times,
% E! @& j; T2 h' U3 Y1 P5 v* jnormally the value is calculated by adding it's principle and interest. 4 H1 B) f+ r. u, l( I" m, H
eg. the value of the mortgage+the interests to be recieved in the future. . l: ~' `: i6 ~
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.7 M( g% \; L8 u9 W, }3 I, n6 v
2 `1 p+ U! }8 r% T3 K- j! Q8 I
im not quite sure if the multiplier effect does really matter in this case.
1 D4 v6 g8 H* [. s2 U2 ]/ N1 Kin stock market, it's the demand and supply pushing the price up/downwards.
' y; ~4 l9 B1 `" T8 m% R: _* k/ m% IFor eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,$ s/ Y: Z/ s9 }: C7 b/ X
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
- }9 O y% V4 I# z) f) z1 uThe 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.
5 _' {% y5 U5 O# w; u$ m- ?but the value of their assets did really drop significantly.: g# k# ~/ r, q8 I/ M
! }7 v5 b+ F7 N* o2 k
[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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