Chap 11 Foriegn Exchange

Chap 11 Foriegn Exchange - 2007 Robert Sweo Foreign...

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Unformatted text preview: 2007 Robert Sweo Foreign Exchange 2007 Robert Sweo Currency Convertibility Fully convertible (biggest currencies in the world) You can exchange them in all major banks Externally convertible Local government restricts them heavely. Cant exchanged inse of country, but it is possible to exchange them outside of it. Soviet Union, China. Non-convertible So a currency, there is no real market for it. 2007 Robert Sweo Foreign Exchange Markets Types of Markets- Over the Counter (OTC) (Bigger market: Banks trading with banks, kiosks changing currencies)- Exchange Traded (commodities markets) Internse markets, London is the biggest one in the world. Trade Time Frames- Spot within 2 days- Forward 3 or more days Outright forward contract currency at a specified rate on a specified date FX Swap simultaneous spot and forward transaction Currency swap swap of currency and interest at a specified date- Options right to buy or sell 2007 Robert Sweo Exchange Rate Tables 2007 Robert Sweo...
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Chap 11 Foriegn Exchange - 2007 Robert Sweo Foreign...

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