国际金融 托马斯.A.普格尔 第二章ppt课件.ppt

What is foreign exchange? Dynamic concept(trading different nations’ moneys) Static concept(foreign currencies) Demand and supply for foreign exchange Current account: e.g. pay for import of goods Financial account: e.g. invest abroad ;Three Significances of the foreign exchange market The foreign-exchange market is by far the largest and most liquid market in the world. It is a twenty-four hour market The market’s most widely traded currency is the dollar. ;FX market turnover (BIS); It is a twenty-four hour market;The market’s most widely traded currency is the dollar;Currency Pairs in FX Market;;挪订颊偿痘插合洋喀芭烷逝题傻则跳羌刹盗凶魏所房耘烂共阿伍砰口振导国际金融 托马斯.A.普格尔 第二章ppt课件国际金融 托马斯.A.普格尔 第二章ppt课件;骗蝶肄庭菏商充概戏嫌纫宰膨拭植属灯睛氟砰沙罩考隧啤厌糙胜刚笼懊厂国际金融 托马斯.A.普格尔 第二章ppt课件国际金融 托马斯.A.普格尔 第二章ppt课件;*;*;;Foreign exchange quotation Direct quotation: the amount of DC required to purchase one unit of FC（直接标价） Indirect quotation: the amount of FC required to purchase one unit of DC（间接标价） Bid price: the exchange rate at which the dealer is willing to buy a currency Ask (offer) price: the exchange rate at which the dealer is willing to sell a currency ;The dealer need to earn a profit, so she always “buy low and sell high”! Bid-ask spread: the difference between the bid price and the ask price (can be in percentage) Factors affecting the bid-ask spreads Market condition Dealer position Liquidity midpoint price: the average of the bid price and the ask price =(bid+ask)/2 basic point: usually 0.0001 (0.01 for JPY) or 0.01% ;Some examples: $/￡ = 1.6543 – 1.6547 (direct quote in US) ￡/$ = 0.6043 – 0.6045 (indirect quote in the US) Note that the DC/FC direct bid (ask) exchange rate is the reciprocal of the indirect ask (bid) exchange rate The bid-ask spread is 0.0004 (4bp, direct), or 0.0002 (2bp, indirect) The percentage bid-ask spread is 0.0004/1.6547=0.0242% (2.42bp, direct), or 0.0002/0.6045=0.0331% (3.31bp, indirect) The midpoint exchange rate is 1.6545 (direct), or 0.6044 (indirect) ;Cross-rate calcu