INTEREST RATE FUTURES IN INDIA Dr. Shashi Srivastava * Divya Srivastava ** Abstract In the era of globalization‚ one of the macro-economic variable that has come into great focus is interest rate. The volatility of interest rates has increased manifold in the last couple of years. Interest rate risk management has become very important and assorted instruments like interest rate
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CNH: Onshore deregulation‚ offshore expansion September 30‚ 2013 Interest rate strategy CNH: Onshore deregulation‚ offshore expansion DBS Group Research 30 September 2013 The Shanghai Free Trade Zone (SFTZ) opened on 29 Sep. According to the blueprint‚ financial innovations including RMB convertibility and interest rate liberalization are the priorities on the reform agenda (see “Shanghai Free Trade Zone & the reinvigoration of China”‚ 26 Sep 2013). These reforms will make the
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Shawn Berry 2/21/2012 Phil 2753 007 Alfred C. Lent and the Simple Body Swap Intuition Alfred Lent argues that the simple mind body swap overlooks the personal history that comes with a body. He also puts on the table the question that does transplanting a brain from one body to a donor body preserve the original personhood. Lent focuses on what makes a person and what qualifies as a person. Also he discusses how much a person can change‚ i.e. lose or gain body parts‚ memory etc.‚ and remain
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Question 7. CDS (Credit Default Swap) is designed to transfer risk from bond holders to CDS issuers. Bond holders buy bonds from a company and buy CDS from insurance company at the same time to make sure even the company default; the bond holders can get the par value back from insurance company. We will look at the CDS spread of Delphi for this question. After we plotted in the data‚ we find out that the overall CDS spread are abnormally large during the year of 2005 and 2008. The high CDS spreads
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Integrated Case 6-21 Morton Handley & Company Interest Rate Determination Maria Juarez is a professional tennis player‚ and your firm manages her money. She has asked you to give her information about what determines the level of various interest rates. Your boss has prepared some questions for you to consider. A. What are the four most fundamental factors that affect the cost of money‚ or the general level of interest rates‚ in the economy? Answer: [Show S6-1 and S6-2 here.] The four most
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HOW INTEREST RATES AFFECT OUR PURCHASING DECISIONS Fluctuating interest rates have a decidedly large impact on purchasing decisions. Higher interest rates mean that consumers don’t have as much disposable income and must cut back on spending. When higher interest rates are coupled with increased lending‚ banks makes fewer loans. Lower interest rates make it easier for farmers and manufacturers to borrow to invest in equipment and buildings. That gives business more incentive to invest
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monetary shocks considered are shocks to the interest rate reaction function equal to 1% compared to the steady-state value for one year. The temporary scal policy shocks correspond to an increase in spending or a decline in revenue for the government of 1% of the baseline GDP‚ for two years. A permanent shock‚ instead‚ consists on a permanent increase in government spending equal to 1% of the steady-state GDP. Benchmark Case: Response to Interest Rate Shocks The authors
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Glossary: 1) Interest rates: An interest rate is the rate at which interest is paid by borrowers to use the money they borrow from a lender. The annualized cost of credit or debt calculated as the percentage ratio of interest to the client. Each bank can determine its own interest rate on loans‚ but in practice local rates are about the same from bank to bank. In general‚ interest rates rise in periods of inflation‚ higher demand for credit‚ narrow money‚ or because of higher reserve requirements
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What effect will a sudden increase in the volatility of gold prices have on interest rates? Agenda History of gold Influencing factors of gold price Volatility of gold Conclusion Historical development Gold Standard ◦ Until 1914 + interwar years USD Standard – Bretton Woods System ◦ After WW II until 1971 Since 1972: gold disconnected from USD ◦ Ordinary traded good ◦ Price determined by supply and demand Revision: Influence factors of demand Wealth Expected returs Expected
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Study –Brac Bank Ltd 16-20 INTRODUCTION: Interest Rate Risk - In the process of FIs performing their asset-transformation function‚ FIs are exposed to Interest Rate Risk‚ from Mismatched Maturity/Duration: Borrowing Short‚ Lending Long. The risk that an investment ’s value will change due to a change in the absolute level of interest rates‚ in the spread between two rates‚ in the shape of the yield curve or in any other interest rate relationship. Such changes usually affect securities
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