Covered interest arbitrage and Market: Difference between pages

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Simultaneously borrowing and depositing in two different currencies and dealing a forward foreign exchange contract between the same currency pair to cover the related foreign exchange exposure.
Place or structure (actual or conceptual) where buyers and sellers  (directly or through intermediaries) trade goods, services, information, contracts or financial instruments.


Covered interest arbitrage activity normally results in the rapid alignment of the forward foreign exchange rate with the related interest rates, as predicted by Interest rate parity theory.




== See also ==
== See also ==
* [[Arbitrage]]
* [[Capital market]]
* [[Covered arbitrage]]
* [[Cash market]]
* [[Covered position]]
* [[Financial markets]]
* [[Interest rate parity]]
* [[Money market]]
* [[Uncovered interest arbitrage]]


[[Category:The_business_context]]
[[Category:Debt_Capital_Markets]]
[[Category:Financial_products_and_markets]]
[[Category:Equity]]

Revision as of 09:25, 9 November 2013

Place or structure (actual or conceptual) where buyers and sellers (directly or through intermediaries) trade goods, services, information, contracts or financial instruments.


See also