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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.
$ f4 ~# i5 T: b1 h, o0 }( }CDs could have different ratings, AAA -> F,
6 O) E+ i7 ^2 _7 W5 @0 n5 omore risky ones would have higher premium (interest rate) as a compensation for an investment.
$ ]' S9 ?" W4 U1 P/ m. ^5 I0 ?main reason why ppl buy those risky CDs is because the rate of return exceeds their internal rate of return,
0 v/ ?! k9 c q$ f; o: Kin other words, the interest rate of that investment > their required interest rate, therefore they invest in those securities.
" _, g; D- S# A( `, HAlso, fund managers would include risky assets in their portfolio for different purposes, eg efficiency.
% l9 [) w+ q# S9 G5 j$ k, l5 Ksimilar to bonds, CDs trading in the secondary market have different value at different times,7 l; H$ y1 Y0 E1 @9 l& M: n: F5 ~
normally the value is calculated by adding it's principle and interest.
u$ N. x$ a7 reg. the value of the mortgage+the interests to be recieved in the future. 7 b& @3 G2 M6 V* f7 A9 d6 B0 y. o
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.4 t1 U/ R4 t$ k5 J0 m, ?
7 k( s0 s- j7 J- Bim not quite sure if the multiplier effect does really matter in this case.
+ _& Z7 j; e) ^2 d4 ]. Nin stock market, it's the demand and supply pushing the price up/downwards.
0 @6 e7 I, G6 T* R! L4 G, B) S! w- eFor eg, A bought 10000 shares @10$ ; B sells 20000 shares to C @ $12,0 W0 j$ e( O& j
A's shares would suddenly increase to $120000 from $100000 which does not invlove any $ transaction.! G( J# u- u! [( K- ]' u
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. 4 Z. G1 h3 m3 O# p- ]
but the value of their assets did really drop significantly.
. R* H5 O3 O8 [ B$ ^( Z
/ ~* w" p% w* Y4 }4 h( D[ 本帖最後由 Kev 於 2008-10-8 07:26 PM 編輯 ] |
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