Interest rate arbitrage refers to the mechanism in which an investor strategises to profit from differences in interest rates between two countries or financial markets. However, the investor may be taking a risk due to the uncertainties of future currency exchange rates. When the investor incorporates an aspect of hedging while practicing interest rate arbitrage, he is assured to pocket a riskless profit. The term covered interest arbitrage is used to describe the form of interest arbitrage where currency exchange has been hedged using derivative instruments. The investor, therefore, makes simultaneous spot and forward transactions (Fong, Valente & Fung, 2010).
Table of Contents
Covered Interest Arbitrage
Laws and Regulations Controlling the Financial Industry
Principles of Direct and Indirect Taxation, and Impact to Stakeholders
Key Characteristics of Various Types of Securities
Equity Securities
Debt Securities
Derivative Instruments
Securities Trading Regulations, Policies, and Procedures
Issues in Global Markets Including LSE
Portfolio Management
Appropriate Types of Savings and Investment for Expansion of Air UK & Co
Principles of Investment Theory
Underlying Concepts of Market Analysis and Efficiency
References
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- Victor Kaonga (Autor), 2018, Investment Analysis, Múnich, GRIN Verlag, https://www.grin.com/document/509661
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