Tutorial9 - Chapters 15 & 16 Foreign exchange Markets...

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Chapters 15 & 16 Foreign exchange Markets 1. Describe the functions, structure and operation of the international FX markets. Include in your answer the main locations of the markets and explain the roles of FX dealers and FX brokers. 2. Importers, exporters, investors and borrowers may all be participants in the FX markets. Explain why each of these parties would be involved in FX market transactions. 3. Distinguish between speculative and arbitrage transactions in the FX market. Describe arbitrage transactions using an example of a triangular arbitrage. 4. Many developed economies operate within a floating exchange-rate regime. Where a country has a floating exchange rate, consider the circumstance in which the central bank of that country might conduct transactions in the FX market. 5. Outline the features of the main types of contracts that are created in the FX markets, distinguishing between short-dated, spot and forward transactions. 6. Using the context of the currency pair USD/JPY, explain the terms ‘base currency’, ‘terms
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Tutorial9 - Chapters 15 & 16 Foreign exchange Markets...

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