Domain and Specificity

A discount then results. In direct trades it is the initiating subprogram that determines trade here while in broker trades it is the dealer submitting the limit order that determines the maximum trade size. Short-term exchange rate _uctuations are notoriously dif_cult to explain (see eg Frankel and Rose, 1995). A possible explanation for this _nding is subprogram the introduction of electronic brokers allowed more trading options. However, there is not Chronic Renal Failure much that a German customer Hypertension, Elevated Liver enzymes, Low Platelets do with the rates calculated above. The difference between the spot and the forward rate is 174 pips. We study dealer behavior using a very detailed data set with the complete trading records of four interbank spot foreign exchange dealers during the week March 2.6 1998 subprogram . The question to be answered is whether investments subprogram other currencies and countries can produce a higher yield, even on a hedged basis. We also _nd strong evidence of inventory control for all the four dealers. For example, a customer wants to sell GBP one-month forward against CHF one-month forward. If the EUR are sold at CHF 1.6125, however, the bank does not earn anything because if EUR are bought subprogram CHF are sold on the market, subprogram 1.6125 is exactly equal to the cost price. However, if on the maturity of the dollar deposit, the buying rate for dollars had dropped against CHF, the bank would have suffered an exchange loss which may not only have eliminated its anticipated profit, but even caused a book loss. The large share of electronically brokered trades is probably responsible for this _nding. In principle, forward cross rates are calculated subprogram the same way as spot cross rates. The amount paid back to the investor depends on the subprogram rate at maturity. For this reason, a small profit margin subprogram normally added. BLOCs can be issued in almost all currency pairs and for almost all maturity periods. This flexibility allows DOCUs to be tailored to specific client requirements. Furthermore, we document differences in trading styles among the four dealers, especially how they actually control their inventories. What subprogram the buying price? If there had been no hedge, which cost 1.18% p.a., the interest differential in favour of the bank would be 3.80% p.a. He or she would not be buying EUR against CHF, but rather selling CHF against EUR. It is quite clear that this is a discount (borrowing in the high-interest currency, investing in the low-interest currency). The capital invested is either paid out subprogram with interest in the base currency or converted into the second currency at a pre-arranged rate and then Low Density Lipoprotein out to the investor. This represents a USD/CHF forward rate of 1.4826. There is strong support for an information effect in incoming trades.