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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.
5 v" u/ R; p2 T. B0 p: |CDs could have different ratings, AAA -> F,
6 z4 w; O# [8 `0 Tmore risky ones would have higher premium (interest rate) as a compensation for an investment.% {/ j- ]4 e* x: U+ n
main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,' a% S; S- L/ I% t8 s2 ]" B8 i
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
, E& r/ A2 B% J% }Also, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
, l2 [9 n/ }+ K! D0 Rsimilar to bonds, CDs trading in the secondary market have different value at different times,( |0 h: [) Q( @+ t* C- t7 S
normally the value is calculated by adding it's principle and interest. % _, J! P& L. o, b5 B6 i! z
eg. the value of the mortgage+the interests to be recieved in the future. 4 ]$ Z5 n- p) [1 c# U/ n
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.6 Z) ?( [1 {. c# q
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im not quite sure if the multiplier effect does really matter in this case.4 N s) H! L( F3 J% a1 G
in stock market, it's the demand and supply pushing the price up/downwards.( \+ G% R& S7 X) ^/ E1 R
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,% W4 q [* G/ y6 F2 \: q/ M9 `
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.! q* ^/ f- }& I& L
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. % g9 O( @3 B$ L1 c5 l
but the value of their assets did really drop significantly.
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+ p' D `8 Z( G* h& o& M0 W1 x' l; s[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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