国际金融市场管理Ch03_International_Financial_Markets教材教学课件.pptVIP

;To describe the background and corporate use of the following international financial markets: foreign exchange market, Eurocurrency market, Eurocredit market, Eurobond market, and international stock markets.;Motives for Using International Financial Markets;Investors invest in foreign markets: to take advantage of favorable economic conditions; when they expect foreign currencies to appreciate against their own; and to reap the benefits of international diversification.;Creditors provide credit in foreign markets: to capitalize on higher foreign interest rates; when they expect foreign currencies to appreciate against their own; and to reap the benefits of international diversification.;Borrowers borrow in foreign markets: to capitalize on lower foreign interest rates; and when they expect foreign currencies to depreciate against their own.;Foreign Exchange Market;Foreign Exchange Market;The following attributes of banks are important to foreign exchange customers: competitiveness of quote special relationship between the bank and its customer speed of execution advice about current market conditions forecasting advice;Banks provide foreign exchange services for a fee: the bank’s bid (buy) quote for a foreign currency will be less than its ask (sell) quote. This is the bid/ask spread. bid/ask % spread = ask rate – bid rate ask rate Example: Suppose bid price for ￡ = $1.52, ask price = $1.60. bid/ask % spread = (1.60–1.52)/1.60 = 5%;The bid/ask spread is normally larger for those currencies that are less frequently traded. The spread is also larger for “retail” transactions than for “wholesale” transactions between banks or large corporations.;InterpretingForeign Exchange Quotations;Direct quotations represent the value of a foreign currency in dollars, while indirect quotations represent the number of units of a foreign currency per dollar. Note that exchange rate quotations sometimes include IMF’s special drawing rights (SDRs). The same currency may al