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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.
1 w7 U( l7 T ~* I, N3 @CDs could have different ratings, AAA -> F,
! ?# @2 B" U! m( U3 }more risky ones would have higher premium (interest rate) as a compensation for an investment.
4 m/ p S$ `9 S7 U9 ?9 Wmain reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,! W( s. Q' c9 s" O$ e K
in other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
0 R- e& X6 D8 VAlso, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
) z% C: @/ ?. ]( Gsimilar to bonds, CDs trading in the secondary market have different value at different times,2 A- q& @# q: X. j% C6 T0 b; b: ?
normally the value is calculated by adding it's principle and interest. ' w, v* C& J1 |' U/ x( o# E
eg. the value of the mortgage+the interests to be recieved in the future. % a+ z) ]+ l" }5 w6 H( z
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.5 U3 o, U% G8 q" k3 O8 [6 ]/ k
6 _! S, D% h$ B7 V& v4 k- O
im not quite sure if the multiplier effect does really matter in this case.
6 N U# y) W7 u1 v1 ein stock market, it's the demand and supply pushing the price up/downwards., a* V( l+ a# P& b2 X. P: T+ y
For eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,
& C6 T8 }2 h# k x& AA's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.
3 m7 C" N& H5 G5 O# u7 H1 CThe 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.
" W: `8 e2 a$ C( h2 z5 V. \but the value of their assets did really drop significantly.
% N$ k- F( O1 c9 d
) t- ~; B+ Y" P4 ^( c5 I[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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