ch07moneymarkets-在線瀏覽
2025-01-30 11:37本頁面
【正文】 D and obligates the bank to make good on the payment at a specific time Bankers Acceptance Money Market Securities l Exporter can hold until the date or sell before maturity l If sold to get the cash before maturity, price received is a discount from draft’s total l Return is based on calculations for other discount securities l Similar to the mercial paper example Bankers Acceptance Major Participants in Money Market n Participants l Commercial banks l Finance, industrial, and service panies l Federal and state governments l Money market mutual funds l All other financial institutions (investing) n Shortterm investing for ine and liquidity n Shortterm financing for short and permanent needs n Large transaction size and telemunication work Valuation of Money Market Securities n Present value of future cash flows at maturity (zero coupon) n Value (price) inversely related to discount rate or yield n Money market security prices more stable than longer term bonds n Yields = riskfree rate + default risk premium Exhibit a International Economic Conditions . Fiscal Policy Issuer’s Industry Conditions Risk Premium of Issuer ShortT erm RiskFree Interest Rate (T bill Rate) Issuer’s Unique Conditions . Moary Policy . Economic Conditions Required Return on the Money Market Security Price of the Money Market Security Interaction Among Money Market Yields n Securities are close investment substitutes n Investors trade to maintain yield differentials n TBill is the benchmark yield in money market n Yield changes in Tbills quickly impacts other securities via dealer trading n Yield differentials determined by risk differences between securities n Default risk premiums vary inversely with econom
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