Mutual Funds, Hedge Funds, and LongTerm Capital共同基金,对冲基金,长期资本

CHAPTER 1AN OVERVIEW OF BANKS AND THE FINANCIAL-SERVICES SECTORGoal of This Chapter: In this chapter you will learn about the many roles financial service providers play in the economy today. You will examine how and why the banking industry and the financial services marketplace as a whole is rapidly changing, becoming new and different as we move forward into the future. You will also learn about new and old services offered to the public.Key Topics in This Chapter•Powerful Forces Reshaping the Industry•What is a Bank?•The Financial System and Competing Financial-Service Institutions•Old and New Services Offered to the Public•Key Trends Affecting All Financial-Service Firms•Appendix: Career Opportunities in Financial ServicesChapter OutlineI. I ntroduction: P owerful Forces Reshaping the IndustryII. W hat Is a Bank?A. D efined by the Functions It Serves and the Roles It Play:B. B anks and their Principal CompetitorsC. Legal Basis of a BankD. D efined by the Government Agency That Insures Its DepositsIII.The Financial System and Competing Financial-Service InstitutionsA.Savings AssociationsB.Credit UnionsC.Money Market FundsD.Mutual FundsE.Hedge FundsF.Security Brokers and DealersG.Investment BankersH.Finance CompaniesI.Financial Holding CompaniesJ.Life and Property/Casualty Insurance CompaniesIV. T he Services Banks and Many of Their Closest Competitors Offer the PublicA. S ervices Banks Have Offered Throughout History1.Carrying Out Currency Exchanges2.Discounting Commercial Notes and Making Business Loans3.Offering Savings Deposits4.Safekeeping of Valuables and Certification of Value5.Supporting Government Activities with Credit6.Offering Checking Accounts (Demand Deposits)7.Offering Trust ServicesB. S ervices Banks and Many of Their Financial-Service Competitors HaveOffered More Recently1.Granting Consumer Loans2.Financial Advising3.Managing Cash4.Offering Equipment Leasing5.Making Venture Capital Loans6.Selling Insurance Policies7.Selling Retirement PlansC. Dealing in Securities: Offering Security Brokerage and Investment Banking Services1. Offering Security Underwriting2. Offering Mutual Funds and Annuities3. Offering Merchant Banking Services4. Offering Risk Management and Hedging ServicesV. Key Trends Affecting All Financial-Service FirmsA. S ervice ProliferationB. R ising CompetitionC. G overnment DeregulationD. A n Increasingly Interest-Sensitive Mix of FundsE. T echnological Change and AutomationF. C onsolidation and Geographic ExpansionG. C onvergenceH. G lobalizationVI. T he Plan of This BookVII. S ummaryConcept Checks1-1. What is a bank? How does a bank differ from most other financial-service providers?A bank should be defined by what it does; in this case, banks are generally those financial institutions offering the widest range of financial services. Other financial service providers offer some of the financial services offered by a bank, but not all of them within one institution.1-2. Under U.S. law what must a corporation do to qualify and be regulated as a commercial bank?Under U.S. law, commercial banks must offer two essential services to qualify as banks for purposes of regulation and taxation, demand (checkable) deposits and commercial loans. More recently, Congress defined a bank as any institution that could qualify for deposit insurance administered by the FDIC.1-3.Why are some banks reaching out to become one-stop financial service conglomerates? Is this a good idea in your opinion?There are two reasons that banks are increasingly becoming one-stop financial service conglomerates. The first reason is the increased competition from other types of financial institution s and the erosion of banks’ traditional service areas. The second reason is the Financial Services Modernization Act which has allowed banks to expand their role to be full service providers.1-4. Which businesses are banking’s closest and toughest com petitors? What services do they offer that compete directly with banks’ services?Among a bank’s closest competitors are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies, and life andproperty-casualty insurance companies. All of these financial service providers are converging and embracing each other’s innovations. The Financial Services Modernization Act has allowed many of these financial service providers to offer the public one-stop shopping for financial services.1-5. What is happening to banking’s share of the financial mark etplace and why? What kind of banking and financial system do you foresee for the future if present trends continue?The Financial Services Modernization Act of 1999 allowed many of the banks’ closest competitors to offer a wide array of financial services thereby taking away market share from “traditional” banks. Banks and their closest competitors are converging into one-stop shopping for financial services and this trend should continue in the future1-6. What different kinds of services do banks offer the public today? What services do their closest competitors offer?Banks offer the widest range of services of any financial institution. They offer thrift deposits to encourage saving and checkable (demand) deposits to provide a means of payment for purchases of goods and services. They also provide credit through direct loans, by discounting the notes that business customers hold, and by issuing credit guarantees. Additionally, they make loans to consumers for purchases of durable goods, such as automobiles, and for home improvements, etc. Banks also manage the property of customers under trust agreements and manage the cash positions of their business customers. They purchase and lease equipment to customers as an alternative to direct loans. Many banks also assist their customers with buying and selling securities through discount brokerage subsidiaries, the acquisition and sale of foreign currencies, the supplying of venture capital to start new businesses, and the purchase of annuities to supply future funding at retirement or for other long-term projects such as supporting a college education. All of these services are also offered by their closest competitors. Banks and their closest competitors are converging and becoming the financial department stores of the modern era.1-7. What is a financial department store? A universal bank? Why do you think these institutions have become so important in the modern financial system? Financial department store and universal bank refer to the same concept. A financial department store is an institution where banking, fiduciary, insurance, and security brokerage services are unified under one roof. A bank that offers all these services is normally referred to as a universal bank. These have become important because of convergence and changes in regulations that have allowed financial service providers to offer all services under one roof1-8. Why do banks and other financial intermediaries exist in modern society, according to the theory of finance?There are multiple approaches to answering this question. The traditional view of banks as financial intermediaries sees them as simultaneously fulfilling the financial-service needs of savers (surplus-spending units) and borrowers(deficit-spending units), providing both a supply of credit and a supply of liquid assets. A newer view sees banks as delegated monitors who assess and evaluate borrowers on behalf of their depositors and earn fees for supplying monitoring services. Banks also have been viewed in recent theory as suppliers of liquidity andtransactions services that reduce costs for their customers and, through diversification, reduce risk. Banks are also critical in the payment system for goods and services and have played an increasingly important role as a guarantor and a risk management role for customers.1-9. How have banking and the financial services market changed in recent years? What powerful forces are shaping financial markets and institutions today? Which of these forces do you think will continue into the future?Banking is becoming a more volatile industry due, in part, to deregulation which has opened up individual banks to the full force of the financial marketplace. At the same time the number and variety of banking services has increased greatly due to the pressure of intensifying competition from nonbank financial-service providers and changing public demand for more conveniently and reliably provided services. Adding to the intensity of competition, foreign banks have enjoyed success in their efforts to enter countries overseas and attract away profitable domestic business and household accounts.1-10. Can you explain why many of the forces you named in the answer to the previous question have led to significant problems for the management of banks and other financial firms and their stockholders?The net result of recent changes in banking and the financial services market has been to put greater pressure upon their earnings, resulting in more volatile returns to stockholders and an increased bank failure rates. Some experts see banks' role and market share shrinking due to restrictive government regulations and intensifying competition. Institutions have also become more innovative in their service offerings and in finding new sources of funding, such as off-balance-sheet transactions. The increased risk faced by institutions today, therefore, has forced managers to more aggressively utilize a wide array of tools and techniques to improve and stabilize their earnings streams and manage the various risks they face. 1-11. What do you think the financial services industry will look like 20 years from now? What are the implications of your projections for its management today? There appears to be a trend toward continuing consolidation and convergence. There are likely to be fewer financial service providers in the future and many of these will be very large and provide a broad range of financial services under one roof. In addition, global expansion will continue and will be critical to the survival of many financial service providers. Management of financial service providers willhave to be more technologically astute and be able to make a more diverse set of decisions including decisions about mergers, acquisitions and global expansion as well as new services to add to the firm.Problems and Projects1. You have just been hired as the marketing officer for the new First National Bank of Vincent, a suburban banking institution that will soon be serving a local community of 120,000 people. The town is adjacent to a major metropolitan area with a total population of well over 1 million. Opening day for the newly chartered bank is just two months away, and the president and the board of directors are concerned that the new bank may not be able to attract enough depositors and good-quality loan customers to meet its growth and profit projections. There are 18 other financial-service competitors in town, including two credit unions, three finance companies, four insurance agencies, and two security broker offices. Your task is to recommend the various services the bank should offer initially to build up an adequate customer base. You are asked to do the following:a.Make a list of all the services the new bank could offer, according to current regulations.b.List the type of information you will need about the local community tohelp you decide which of the possible services are likely to have sufficientdemand to make them profitable.c.Divide the possible services into two groups--those you think are essentialto customers and should be offered beginning with opening day, and thosethat can be offered later as the bank grows.d. Briefly describe the kind of advertising campaign you would like to run tohelp the public see how your bank is different from all the other financialservice providers in the local area. Which services offered by the nonblankservice providers would be of most concern to the new bank’smanagement?Banks can offer, if they choose, a wide variety of financial services today. These services are listed below. However, unless they are affiliated with a larger bank holding company and can offer some of these services through that company, it may be more limited in what it can offer.Regular Checking Accounts Management Consulting Services NOW Accounts Letters of CreditPassbook Savings Deposits Business Inventory Loans Certificates of Deposit Asset-Based Commercial Loans Money Market Deposits Discounting of Commercial Paper Automobile Loans Plant and Equipment Loans Retirement Savings Plans Venture Capital LoansNonauto Installment Loans to IndividualsResidential Real Estate Loans Leasing Plans for Business Property and EquipmentHome Improvement Loans Security Dealing and Underwriting Personal Trust Management Services Discount Security BrokerageCommercial Trust Services Institutional Trust Services Foreign Currency Trading and ExchangePersonal Financial Advising Personal Cash-Management ServicesInsurance Policy Sales (Mainly Credit-Life)Insurance Today (Except in Some States)) Standby Credit Guarantees Acceptance FinancingTo help the new bank decide which services to offer it would be helpful to gather information about some of the following items in the local community:School Enrollments and Growth in School EnrollmentsEstimated Value of Residential and Commercial PropertyRetail SalesPercentage of Home Ownership Among Residents in the AreaNumber and Size (in Sales and Work Force) of Local Business Establishments Major Population Locations (i.e., Major Subdivisions, etc.) and Any Projected Growth AreasPopulation Demographics (i.e., Age Distribution of the Area)Projected Growth Areas of Industries in the AreaEssential services the bank would probably want to offer right from the beginning includes:Regular Checking Accounts Home Improvement Loans Automobile and other Consumer-type Money Market Deposit Accounts Installment Loans Retirement Savings PlansNOW Accounts Business Inventory LoansPassbook Savings Deposits Discounting of High-QualityCommercial NotesResidential Real Estate LoansCertificates of DepositAs the bank grows, opportunities for the profitable sale of additional services usually increase, especially for trust services for individuals and smaller businesses and personal financial advising as well as some commercial (plant and equipment) loans and leases. Further growth may result in the expansion of commercial trust services as well as a widening variety of commercial loans and credit guarantees.The bank would want to develop an advertising campaign that sends a message to potential customers that the new bank is, indeed, different from its competitors. Small banks often have the advantage of offering highly personalized services in which their customers are known and recognized and services are tailored to each individual customer's special financial needs. Quality and reliability of banking service are often more important to individual customers than is price. A new bank must try to sell prospective customers, most of who will come from other banks in the area, on personalized services, quality, and reliability - all three of which should be emphasized in its advertising program.2. Leading money center banks in the United States have accelerated their investment banking activities all over the globe in recent years, purchasing corporate debt securities and stock from their business customers and reselling those securities to investors in the open market. Is this a desirable move by these banking organizations from a profit standpoint? From a risk standpoint? From the public interest point of view? How would you research their question? If you were managing a corporation that had placed large deposits with a bank engaged in such activities, would you be concerned about the risk to your company's funds? What could you do to better safeguard those funds?In the 1970's and early 1980's investment banking was so profitable that commercial bankers were lured into the investment banking business largely because of its greater profit potential than possessed by more traditional commercial banking activities. Later foreign banks, particularly the British and Japanese banking firms, began to attract away large corporate customers from U.S. banks, who were restrained by regulation from offering many investment banking services. Thus, U.S. banks ran into severe difficulty in simply trying to hold onto their traditional corporate credit and deposit accounts because they could not compete service-wise in the investment banking field. Today, banks are allowed to underwrite securities through either a subsidiary or through a holding company structure. This change occurred as part of the Gramm-Leach-Bliley Act (Financial Services Modernization Act).Unfortunately, if investment banking is more profitable than traditional banking product lines, it is also more risky, consistent with the basic tenet of finance that risk and return are directly related. That is why the Federal Reserve Board has placed such strict limits on the type of organization that can offer these services. Currently, the underwriting of most corporate securities must be done through a subsidiary or as a separate part of the holding company so that, in theory at least, the bank is not responsible for any losses incurred. For this reason there may be little reason for depositors (including large corporate depositors) to be concerned about risk exposure from investment banking. Moreover, the ability to offer such services may make U.S. banks more viable in the long run which helps their corporate customers who depend upon them for credit.On the other hand, opponents of investment banking powers for bank operations inside the U.S. have some reasonable concerns that must be addressed. There are, for example, possible conflicts of interest. Information gathered in the investment banking division could be used to the detriment of customers purchasing other bank services. For example, a customer seeking a loan may be told that he or she must buy securities from the bank's investment banking division in order to receive a loan. Moreover, banks could gain effective control over some nonblank industrial corporations which might subject them to added risk exposure and place industrial firms not allied with banks at a competitive disadvantage. As a result theGramm-Leach-Bliley Act has built in some protections to prevent this from happening.3. The term bank has been applied broadly over the years to include a diverse set of financial-service institutions, which offer different financial service packages.Identify as many o f the different kinds of “banks” as you can. How do the “banks” you have identified compare to the largest banking group of all – the commercial banks? Why do you think so many different financial firms have been called banks? How might this terminological confusion affect financial-service customers?The general public tends to classify anything as a bank that offers some sort of financial service, especially deposit and loan services. Other institutions that are often referred to as a bank without being one are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies and life and property/casualty insurance companies. All of these institutions offer some of the services that a commercial bank offers, but generally not the entire scope of services. Since providers of financial services are normally called banks by the general public they are able to take away business from traditional banks and it is of utmost importance for commercial banks to clarify their unique position among financial services providers.4. What advantages can you see to banks affiliating with insurance companies? How might such an affiliation benefit a bank? An insurer? Can you identify any possible disadvantages to such an affiliation? Can you cite any real world examples of bank-insurer affiliations? How well do they appear to have worked out in practice?Before Glass-Steagall banks used to sell insurance services to their customers on a regular basis. in particular, banks would sell life insurance companies to loan customers to ensure repayment of the loan in case of death or disablement. These reasons still exist today and the right to sell insurances to customers again benefits banks in allowing them to offer their customers complete financial packages from financing the home or car to insure it, from giving investment advice to selling life insurance policies and annuities for retirement planning. Generally, a bank customer who is already purchasing a service from a bank might feel compelled to purchase an insurance product, as well. On the other hand, insurance companies sometimes have a negative image, which makes it more difficult to sell certain insurance products. Combining their products with the trust that people generally have in banks will make it easier for them to sell their products. The most prominent example of a bank-insurer affiliation is the merger of Citicorp and Traveler’s Insurance to Citigroup. However, given that Citigroup has sold Traveler’s Insurance indicates that the anticipated synergy effects did not materialize.5. Explain the difference between consolidation and convergence. Are these trends in banking and financial services related? Do they influence each other? How? Consolidation refers to increase in the size of financial institutions and the decline in the number of small independently owned banks and financial service providers. Convergence is the bringing together of firms from different industries to createconglomerate firms offering multiple services. Clearly, these two trends are related. In their effort to compete with each other, banks and their closest competitors have acquired other firms in their industry as well across industries to provide multiple financial services in multiple markets.6. What is a financial intermediary? What are their key characteristics? Is a bank a type of financial intermediary? Why? What other financial-services companies are financial intermediaries? What important role within the financial system do financial intermediaries play?A financial intermediary is a business that interacts with deficit spending individuals and institutions and surplus spending individuals and institutions. For that reason any financial service provider (including banks) is considered a financial intermediary. In their function as intermediaries they act as a bridge between the deficit and surplus spending units by offering financial services to the surplus spending individuals and then loaning those funds to the deficit spending individuals. Financial intermediaries accelerate economic growth by increasing the pool of available funds and lowering the risk of investments through diversification.。

基金管理外文文献翻译(含：英文原文及中文译文)文献出处：英文原文Is Money Really “Smart”? New Evidence on the Relation Between Mutual Fund Flows, Manager Behavior, and Performance PersistenceRuss WermersMutual fund returns strongly persist over multi-year periods—that is the central finding of this paper. Further, consumer and fund manager behavior both play a large role in explaining these longterm continuation patterns—consumers invest heavily in last-year’s winning funds, and managers of these winners invest these inflows in momentum stocks to continue to outperform other funds for at least two years following the ranking year. By contrast, managers of losing funds appear reluctant to sell their losing stocks to finance the purchase of new momentum stocks, perhaps due to a disposition effect. Thus, momentum continues to separate winning from losing managers for a much longer period than indicated by prior studies.Even more surprising is that persistence in winning fund returns is not entirely explained by momentum—we find strong evidence that flow-related buying, especially among growth-oriented funds, pushes up stock prices. Specifically, stocks that winning funds purchase in responseto persistent flows have returns that beat their size, book-to-market, and momentum benchmarks by two to three percent per year over a four-year period. Cross-sectional regressions indicate that these abnormal returns are strongly related to fund inflows, but not to the past performance of the funds—thus, casting some doubt on prior findings of persistent manager talent in picking stocks. Finally, at the style-adjusted net returns level, we find no persistence, consistent with the results of prior studies. On balance, we confirm that money is smart in chasing winning managers, but that a “copycat” s trategy of mimicking winning fund stock trades to take advantage of flow-related returns appears to be the smartest strategy.Eighty-eight million individuals now hold investments in U.S. mutual funds, with over 90 percent of the value of these investments being held in actively managed funds. Further, actively managed equity funds gain the lion’s share of consumer inflows—flows of net new money to equity funds (inflows minus outflows) totalled $309 billion in 2000, pushing the aggregate value of investments held by these funds to almost $4 trillion at year-end 2000. While the majority of individual investors apparently believe in the virtues of active management in general, many appear to hold even stronger beliefs concerning the talents of subgroups of fund managers—they appear to believe that, among the field of active managers, superior managers exist that can “beat the market” for long periods of time. In particular, Morningstar and Lipper compete vigorouslyfor the attention of these true believers by providing regular fund performance rankings, while popular publications such as Money Magazine routinely profile “star” mutual fund managers. In addition, investor dollars, while not very quick to abandon past losing funds, aggressively chase past winners (see, for example, Sirri and Tufano (1998)).Are these “performance-chasers” wasting their money and time, or is money “smart”? Several past papers have attempted to tackle this issue, with somewhat differing results. For example, Grinblatt and Titman (1989a, 1993) find that some mutual fund managers are able to consistently earn positive abnormal returns before fees and expenses, while Brown and Goetzmann (1995; BG) attribute persistence to inferior funds consistently earning negative abnormal returns. Gruber (1996) and Zheng (1999) examine persistence from the viewpoint of consumer money flows to funds, and find that money is “smart”—that is, money flows disproportionately to funds exhibiting superior future returns. However, the exact source of the smart money effect remains a puzzle—does smart money capture manager talent or, perhaps, simply momentum in stock returns?1 More recently, Carhart (1997) examines the persistence in net returns of U.S. mutual funds, controlling for the continuation attributable to priced equity styles (see, for example, Fama and French (1992, 1993, 1996), Jegadeesh and Titman (1993), Daniel andTitman (1997), and Moskowitz and Grinblatt (1999)). Carhart finds little evidence of superior funds that consistently outperform their style benchmarks—specifically, Carhart finds that funds in the highest net return decile (of the CRSP mutual fund database) during one year beat funds in the lowest decile by about 3.5 percent during the following year, almost all due to the one-year momentum effect documented by Jegadeesh and Titman (1993) and to the unexplained poor performance of funds in the lowest prior-year return decile.2 Thus, Carhart (1997) suggests that money is not very smart. Recent studies find somewhat more promising results than Carhart (1997). Chen, Jegadeesh, and Wermers (1999) find that stocks most actively purchased by funds beat those most actively sold by over two percent per year, while Bollen and Busse (2002) find evidence of persistence in quarterly fund performance. Wermers (2000) finds that, although the average style-adjusted net return of the average mutual fund is negative (consistent with Carhart’s study), high-turnover funds exhibit a net return that is significantly higher than low-turnover funds. In addition, these highturnover funds pick stocks well enough to cover their costs, even adjusting for style-based returns. This finding suggests that fund managers who trade more frequently have persistent stockpicking talents. All of these papers provide a more favorable view of the average actively managed fund than prior research, although none focus on the persistence issue with portfolio holdings data.This study examines the mutual fund persistence issue using both portfolio holdings and net returns data, allowing a more complete analysis of the issue than past studies. With these data, we develop measures that allow us to examine the roles of consumer inflows and fund manager behavior in the persistence of fund performance. Specifically, we decompose the returns and costs of each mutual fund into that attributable to (1) manager skills in picking stocks having returns that beat their style-based benchmarks (selectivity), (2) returns that are attributable to the characteristics (or style) of stockholdings, (3) trading costs, (4) expenses, and (5) costs that are associated with the daily liquidity offered by funds to the investing public (as documented by Edelen (1999)). Further, we construct holdings-based measures of momentum-investing behavior by the fund managers. Together, these measures allow an examination of the relation between flows, manager behavior, and performance persistence.In related work, Sirri and Tufano (1998) find that consumer flows react about as strongly to one-year lagged net returns as to any other fund characteristic. In addition, the model of Lynch and Musto (2002) predicts that performance repeats among winners (but not losers), while the model of Berk and Green (2002) predicts no persistence (or weak persistence) as consumer flows compete away any managerial talent. Consistent with Sirri and Tufano (1998), and to test the competing viewpoints of Lynchand Musto (2002) and Berk and Green (2002), we sort funds on their one-year lagged net returns for most tests in this paper. While other ways of sorting funds are attempted.DataWe merge two major mutual fund databases for our analysis of mutual fund performance. Details on the process of merging these databases is available in Wermers (2000). The first database contains quarterly portfolio holdings for all U.S. equity mutual funds existing at any time between January 1, 1975 and December 31, 1994; these data were purchased from Thomson/CDA of Rockville, Maryland. The CDA dataset lists the equity portion of each fund’s holdings (i.e., the shareholdings of each stock held by that fund) along with a listing of the total net assets under management and the self-declared investment objective at the beginning of each calendar quarter. CDA began collecting investment-objective information on June 30, 1980; we supplement these data with hand-collected investment objective data from January 1, 1975.The second mutual fund database is available from the Center for Research in Security Prices (CRSP) and is used by Carhart (1997). The CRSP database contains monthly data on net returns, as well as annual data on portfolio turnover and expense ratios for all mutual funds existing at any time between January 1, 1962 and December 31, 2000. Further details on the CRSP mutual fund database are available from CRSP.These two databases were merged to provide a complete record of the stockholdings of a given fund, along with the fund’s turnover, expense ratio, net returns, investment objective, and total net assets under management during the entire time that the fund existed during our the period of 1975 to 1994 (inclusive).5 Finally, stock prices and returns were obtained from the CRSP stock files.Performance-Decomposition Methodology In this study, we use several measures that quantify the ability of a mutual fund manager to choose stocks, as well as to generate superior performance at the net return level. These measures, in general, decompose the return of the stocks held by a mutual fund into several components in order to both benchmark the stock portfolio and to provide a performance attribution for the fund. The measures used to decompose fund returns include:1. the portfolio-weighted return on stocks currently held by the fund, in excess of returns (during the same time period) on matched control portfolios having the same style characteristics (selectivity)2. the portfolio-weighted return on control portfolios having the same characteristics as stocks currently held by the fund, in excess of time-series average returns on those control portfolios (style timing)3. the time-series average returns on control portfolios having the same characteristics as stocks currently held (style-based returns)4. the execution costs incurred by the fund5. the expense ratio charged by the fund6. the net returns to investors in the fund, in excess of the returns to an appropriate benchmark portfolio.The first three components of performance, which decompose the return on the stocks held by a given mutual fund before any trading costs or expenses are considered, are briefly described next. We estimate the execution costs of each mutual fund during each quarter by applying recent research on institutional trading costs to our stockholdings data—we also describe this procedure below. Data on expense ratios and net returns are obtained directly from the merged mutual fund database. Finally, we describe the Carhart (1997) regression-based performance measure, which we use to benchmark-adjust net returns.The Ferson-Schadt Measure Ferson and Schadt (FS, 1996) develop a conditional performance measure at the net returns level. In essence, this measure identifies a fund manager as providing value if the manager provides excess net returns that are significantly higher than the fund’s matched factor benchmarks, both unconditional and conditional. The conditional benchmarks control for any predictability of the factor return premia that is due to evolving public information. Managers, therefore, are only labeled as superior if they possess superior private information on stock prices, and not if they change factor loadings over time in response to public information. FS also find that these conditionalbenchmarks help to control for the response of consumer cashflows to mutual funds. For example, when public information indicates that the market return will be unusually high, consumers invest unusually high amounts of cash into mutual funds, which reduces the performance measure, “alpha,” from an unconditional model (such as the Carhart model). This reduction in alpha occurs because the unconditional model does not control for the negative market timing induced by the flows. Edelen (1999) provides further evidence of a negative impact of flows on measured fund performance. Using the FS model mitigates this flow-timing effect. The version of the FS model used in this paper starts with the unconditional Carhart four-factor model and adds a market factor that is conditioned on the five FS economic variables.Decomposing the Persistence in Mutual Fund ReturnsSirri and Tufano (1998) find that consumer flows react about as strongly to one-year lagged net returns as to any other fund characteristic. In addition, the model of Lynch and Musto (2002) predicts that performance repeats among winners (but not losers), while the model of Berk and Green (2002) predicts no persistence (or weak persistence) as consumer flows compete away any managerial talent. Consistent with Sirri and Tufano (1998), and to test the competing viewpoints of Lynch and Musto (2002) and Berk and Green (2002), we sort funds on their one-year lagged net returns for the majority of tests in the remainder ofthis paper. When appropriate, we provide results for other sorting approaches as well.中文译文资金真的是“聪明”吗？关于共同基金流动，经理行为和绩效持续性关系的新证据作者：Russ Wermers此外，基金的复苏在多年期间强烈持续- 这是本文的核心发现。

CHAPTER 5 THE MARKET FOR FOREIGN EXCHANGESUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTERQUESTIONS AND PROBLEMSQUESTIONS1. Give a full definition of the market for foreign exchange.Answer: Broadly defined, the foreign exchange (FX) market encompasses the conversion of purchasing power from one currency into another, bank deposits of foreign currency, the extension of credit denominated in a foreign currency, foreign trade financing, and trading in foreign currency options and futures contracts.2. What is the difference between the retail or client market and the wholesale or interbank market for foreign exchange?Answer: The market for foreign exchange can be viewed as a two-tier market. One tier is the wholesale or interbank market and the other tier is the retail or client market. International banks provide the core of the FX market. They stand willing to buy or sell foreign currency for their own account. These international banks serve their retail clients, corporations or individuals, in conducting foreign commerce or making international investment in financial assets that requires foreign exchange. Retail transactions account for only about 14 percent of FX trades. The other 86 percent is interbank trades between international banks, or non-bank dealers large enough to transact in the interbank market.3. Who are the market participants in the foreign exchange market?Answer: The market participants that comprise the FX market can be categorized into five groups: international banks, bank customers, non-bank dealers, FX brokers, and central banks. International banks provide the core of the FX market. Approximately 100 to 200 banks worldwide make a market in foreign exchange, i.e., they stand willing to buy or sell foreign currency for their own account. These international banks serve their retail clients, the bank customers, in conducting foreign commerce or making international investment in financial assets that requires foreign exchange. Non-bank dealers are large non-bank financial institutions, such as investment banks, mutual funds, pension funds, and hedge funds, whose size and frequency of trades make it cost- effective to establish their own dealing rooms to trade directly in the interbank market for their foreign exchange needs.Most interbank trades are speculative or arbitrage transactions where market participants attempt to correctly judge the future direction of price movements in one currency versus another or attempt to profit from temporary price discrepancies in currencies between competing dealers.FX brokers match dealer orders to buy and sell currencies for a fee, but do not take a position themselves. Interbank traders use a broker primarily to disseminate as quickly as possible a currency quote to many other dealers.Central banks sometimes intervene in the foreign exchange market in an attempt to influence the price of its currency against that of a major trading partner, or a country that it “fixes” or “pegs” its currency against. Intervention is the process of using foreign currency reser ves to buy one’s own currency in order to decrease its supply and thus increase its value in the foreign exchange market, or alternatively, selling one’s own currency for foreign currency in order to increase its supply and lower its price.4. How are foreign exchange transactions between international banks settled?Answer: The interbank market is a network of correspondent banking relationships, with large commercial banks maintaining demand deposit accounts with one another, called correspondent bank accounts. The correspondent bank account network allows for the efficient functioning of the foreign exchange market. As an example of how the network of correspondent bank accounts facilities international foreign exchange transactions, consider a U.S. importer desiring to purchase merchandise invoiced in guilders from a Dutch exporter. The U.S. importer will contact his bank and inquire about the exchange rate. If the U.S. importer accepts the offered exchange rate, the bank will debit the U.S. importer’s account for the purchase of the Dutch guilders. The bank will instruct its correspondent bank in the Netherlands to debit its correspondent bank account the appropriate amount of guilders and to credit the Dutch exporter’s bank account. The importer’s bank will then debit its books to offset the debit of U.S. importer’s account, reflecting the decrease in its correspondent bank account balan ce.5. What is meant by a currency trading at a discount or at a premium in the forward market?Answer: The forward market involves contracting today for the future purchase or sale of foreign exchange. The forward price may be the same as the spot price, but usually it is higher (at a premium) or lower (at a discount) than the spot price.6. Why does most interbank currency trading worldwide involve the U.S. dollar?Answer: Trading in currencies worldwide is against a common currency that has international appeal. That currency has been the U.S. dollar since the end of World War II. However, the euro and Japanese yen have started to be used much more as international currencies in recent years. More importantly, trading would be exceedingly cumbersome and difficult to manage if each trader made a market against all other currencies.7. Banks find it necessary to accommodate their clients’ needs to buy or sell FX forward, in many instances for hedging purposes. How can the bank eliminate the currency exposure it has created for itself by accommodating a client’s forward transaction?Answer: Swap transactions provide a means for the bank to mitigate the currency exposure in a forward trade. A swap transaction is the simultaneous sale (or purchase) of spot foreign exchange against a forward purchase (or sale) of an approximately equal amount of the foreign currency. To illustrate, suppose a bank customer wants to buy dollars three months forward against British pound sterling. The bank can handle this trade for its customer and simultaneously neutralize the exchange rate risk in the trade by selling (borrowed) British pound sterling spot against dollars. The bank will lend the dollars for three months until they are needed to deliver against the dollars it has sold forward. The British pounds received will be used to liquidate the sterling loan.8. A CD/$ bank trader is currently quoting a small figure bid-ask of 35-40, when the rest of the market is trading at CD1.3436-CD1.3441. What is implied about the trader’s beliefs by his prices?Answer: The trader must think the Canadian dollar is going to appreciate against the U.S. dollar and therefore he is trying to increase his inventory of Canadian dollars by discouraging purchases of U.S. dollars by standing willing to buy $ at only CD1.3435/$1.00 and offering to sell from inventory at the slightly lower than market price of CD1.3440/$1.00.9. What is triangular arbitrage? What is a condition that will give rise to a triangular arbitrage opportunity?Answer: Triangular arbitrage is the process of trading out of the U.S. dollar into a second currency, then trading it for a third currency, which is in turn traded for U.S. dollars. The purpose is to earn anarbitrage profit via trading from the second to the third currency when the direct exchange between the two is not in alignment with the cross exchange rate.Most, but not all, currency transactions go through the dollar. Certain banks specialize in making a direct market between non-dollar currencies, pricing at a narrower bid-ask spread than the cross-rate spread. Nevertheless, the implied cross-rate bid-ask quotations impose a discipline on the non-dollar market makers. If their direct quotes are not consistent with the cross exchange rates, a triangular arbitrage profit is possible.PROBLEMS1. Using Exhibit 5.4, calculate a cross-rate matrix for the euro, Swiss franc, Japanese yen, and the British pound. Use the most current American term quotes to calculate the cross-rates so that the triangular matrix resulting is similar to the portion above the diagonal in Exhibit 5.6.Solution: The cross-rate formula we want to use is:S(j/k) = S($/k)/S($/j).The triangular matrix will contain 4 x (4 + 1)/2 = 10 elements.¥SF £$Euro 138.05 1.5481 .6873 1.3112 Japan (100) 1.1214 .4979 .9498 Switzerland .4440 .8470U.K 1.90772. Using Exhibit 5.4, calculate the one-, three-, and six-month forward cross-exchange rates between the Canadian dollar and the Swiss franc using the most current quotations. State the forward cross-rates in “Canadian” terms.Solution: The formulas we want to use are:F N(CD/SF) = F N($/SF)/F N($/CD)orF N(CD/SF) = F N(CD/$)/F N(SF/$).We will use the top formula that uses American term forward exchange rates.F1(CD/SF) = .8485/.8037 = 1.0557F3(CD/SF)= .8517/.8043 = 1.0589F6(CD/SF)= .8573/.8057 = 1.06403. Restate the following one-, three-, and six-month outright forward European term bid-ask quotes in forward points.Spot 1.3431-1.3436One-Month 1.3432-1.3442Three-Month 1.3448-1.3463Six-Month 1.3488-1.3508Solution:One-Month 01-06Three-Month 17-27Six-Month 57-724. Using the spot and outright forward quotes in problem 3, determine the corresponding bid-ask spreads in points.Solution:Spot 5One-Month 10Three-Month 15Six-Month 205. Using Exhibit 5.4, calculate the one-, three-, and six-month forward premium or discount for the Canadian dollar versus the U.S. dollar using American term quotations. For simplicity, assume each month has 30 days. What is the interpretation of your results?Solution: The formula we want to use is:f N,CD= [(F N($/CD) - S($/CD/$)/S($/CD)] x 360/Nf1,CD= [(.8037 - .8037)/.8037] x 360/30 = .0000f3,CD= [(.8043 - .8037)/.8037] x 360/90 = .0030f6,CD= [(.8057 - .8037)/.8037] x 360/180 = .0050The pattern of forward premiums indicates that the Canadian dollar is trading at an increasing premium versus the U.S. dollar. That is, it becomes more expensive (in both absolute and percentage terms) to buy a Canadian dollar forward for U.S. dollars the further into the future one contracts.6. Using Exhibit 5.4, calculate the one-, three-, and six-month forward premium or discount for the U.S. dollar versus the British pound using European term quotations. For simplicity, assume each month has 30 days. What is the interpretation of your results?Solution: The formula we want to use is:f N,$= [(F N (£/$) - S(£/$))/S(£/$)] x 360/Nf1,$= [(.5251 - .5242)/.5242] x 360/30 = -.0023f3,$= [(.5268 - .5242)/.5242] x 360/90 = -.0198f6,$= [(.5290 - .5242)/.5242] x 360/180 = -.0183The pattern of forward premiums indicates that the British pound is trading at a discount versus the U.S. dollar. That is, it becomes more expensive to buy a U.S. dollar forward for British pounds (in absolute but not percentage terms) the further into the future one contracts.7. Given the following information, what are the NZD/SGD currency against currency bid-ask quotations?American Terms European TermsBank Quotations Bid Ask Bid AskNew Zealand dollar .7265 .7272 1.3751 1.3765Singapore dollar .6135 .6140 1.6287 1.6300Solution: Equation 5.12 from the text implies S b(NZD/SGD) = S b($/SGD) x S b(NZD/$) = .6135 x 1.3765 = .8445. The reciprocal, 1/S b(NZD/SGD)= S a(SGD/NZD)= 1.1841. Analogously, it is implied that S a(NZD/SGD) = S a($/SGD) x S a(NZD/$) = .6140 x 1.3765 = .8452. The reciprocal, 1/S a(NZD/SGD) = S b(SGD/NZD)= 1.1832. Thus, the NZD/SGD bid-ask spread is NZD0.8445-NZD0.8452 and the SGD/NZD spread is SGD1.1832-SGD1.1841.8. Assume you are a trader with Deutsche Bank. From the quote screen on your computer terminal, you notice that Dresdner Bank is quoting €0.7627/$1.00 and Credit Suisse is offering SF1.1806/$1.00. You learn that UBS is making a direct market between the Swiss franc and the euro, with a current €/SF quote of .6395. Show how you can make a triangular arbitrage profit by trading at these prices. (Ignore bid-ask spreads for this problem.) Assume you have $5,000,000 with which to conduct the arbitrage. What happens if you initially sell dollars for Swiss francs? What €/SF price will eliminate triangular arbitrage?Solution: To make a triangular arbitrage profit the Deutsche Bank trader would sell $5,000,000 to Dresdner Bank at €0.7627/$1.00. This trade would yield €3,813,500= $5,000,000 x .7627. The Deutsche Bank trader would then sell the euros for Swiss francs to Union Bank of Switzerland at a price of €0.6395/SF1.00, yielding SF5,963,253 = €3,813,500/.6395. The Deutsche Bank trader will resell the Swiss francs to Credit Suisse for $5,051,036 = SF5,963,253/1.1806, yielding a triangular arbitrage profit of $51,036.If the Deutsche Bank trader initially sold $5,000,000 for Swiss francs, instead of euros, the trade would yield SF5,903,000 = $5,000,000 x 1.1806. The Swiss francs would in turn be traded for euros to UBS for €3,774,969= SF5,903,000 x .6395. The euros would be resold to Dresdner Bank for $4,949,481 = €3,774,969/.7627, or a loss of $50,519. Thus, it is necessary to conduct the triangular arbitrage in the correct order.The S(€/SF)cross exchange rate should be .7627/1.1806 = .6460. This is an equilibrium rate at which a triangular arbitrage profit will not exist. (The student can determine this for himself.) A profit results from the triangular arbitrage when dollars are first sold for euros because Swiss francs are purchased for euros at too low a rate in comparison to the equilibrium cross-rate, i.e., Swiss francs are purchased for only €0.6395/SF1.00 instead of the no-arbitrage rate of €0.6460/SF1.00. Similarly, when dollars are first sold for Swiss francs, an arbitrage loss results because Swiss francs are sold for euros at too low a rate, resulting in too few euros. That is, each Swiss franc is sold for €0.6395/SF1.00 instead of the higher no-arbitrage rate of €0.6460/SF1.00.9. The current spot exchange rate is $1.95/£ and the three-month forward rate is $1.90/£. Based on your analysis of the exchange rate, you are pretty confident that the spot exchange rate will be $1.92/£ in three months. Assume that you would like to buy or sell £1,000,000.a. What actions do you need to take to speculate in the forward market? What is the expected dollar profit from speculation?b. What would be your speculative profit in dollar terms if the spot exchange rate actually turns out to be $1.86/£.Solution:a. If you believe the spot exchange rate will be $1.92/£ in three months, you should buy £1,000,000 forward for $1.90/£. Your expected profit will be:$20,000 = £1,000,000 x ($1.92 -$1.90).b. If the spot exchange rate actually turns out to be $1.86/£ in three months, your loss from the long position will be:-$40,000 = £1,000,000 x ($1.86 -$1.90).10. Omni Advisors, an international pension fund manager, plans to sell equities denominated in Swiss Francs (CHF) and purchase an equivalent amount of equities denominated in South African Rands (ZAR).Omni will realize net proceeds of 3 million CHF at the end of 30 days and wants to eliminate the risk that the ZAR will appreciate relative to the CHF during this 30-day period. The following exhibit shows current exchange rates between the ZAR, CHF, and the U.S. dollar (USD).Currency Exchange Ratesa.Describe the currency transaction that Omni should undertake to eliminate currency riskover the 30-day period.b.Calculate the following:• The CHF/ZAR cross-currency rate Omni would use in valuing the Swiss equityportfolio.•The current value of Omni’s Swiss equity portfolio in ZAR.• The annualized forward premium or discount at which the ZAR is trading versus theCHF.CFA Guideline Answer:a.To eliminate the currency risk arising from the possibility that ZAR will appreciateagainst the CHF over the next 30-day period, Omni should sell 30-day forward CHFagainst 30-day forward ZAR delivery (sell 30-day forward CHF against USD and buy30-day forward ZAR against USD).b.The calculations are as follows:•Using the currency cross rates of two forward foreign currencies and three currencies (CHF, ZAR, USD), the exchange would be as follows:--30 day forward CHF are sold for USD. Dollars are bought at the forward sellingprice of CHF1.5285 = $1 (done at ask side because going from currency into dollars)--30 day forward ZAR are purchased for USD. Dollars are simultaneously sold to purchase ZAR at the rate of 6.2538 = $1 (done at the bid side because going fromdollars into currency)--For every 1.5285 CHF held, 6.2538 ZAR are received; thus the cross currency rate is1.5285 CHF/6.2538 ZAR = 0.244411398.• At the time of execution of the forward contracts, the v alue of the 3 million CHF equity portfolio would be 3,000,000 CHF/0.244411398 = 12,274,386.65 ZAR.• To calculate the annualized premium or discount of the ZAR against the CHF requires comparison of the spot selling exchange rate to the forward selling price of CHF for ZAR.Spot rate = 1.5343 CHF/6.2681 ZAR = 0.24477912030 day forward ask rate 1.5285 CHF/6.2538 ZAR = 0.244411398The premium/discount formula is:[(forward rate – spot rate) / spot rate] x (360 / # day contract) =[(0.244411398 – 0.24477912) / 0.24477912] x (360 / 30) =-1.8027126 % = -1.80% discount ZAR to CHFMINI CASE: SHREWSBURY HERBAL PRODUCTS, LTD.Shrewsbury Herbal Products, located in central England close to the Welsh border, is an old-line producer of herbal teas, seasonings, and medicines. Its products are marketed all over the United Kingdom and in many parts of continental Europe as well.Shrewsbury Herbal generally invoices in British pound sterling when it sells to foreign customers in order to guard against adverse exchange rate changes. Nevertheless, it has just received an order from a large wholesaler in central France for £320,000 of its products, conditional upon delivery being made in three months’ time and the order invoiced in euros.Shrewsbury’s controller, Elton Peters, is concerned with whether the pound will appreciate versus the euro over the next three months, thus eliminating all or most of the profit when the euro receivable is paid. He thinks this is an unlikely possibility, but he decides to contact the firm’s banker for suggestions about hedging the exchange rate exposure.Mr. Peters learns from the banker that the current spot e xchange rate is €/£ is €1.4537, thus the invoice amount should be €465,184. Mr. Peters also learns that the three-month forward rates for the pound and the euro versus the U.S. dollar are $1.8990/£1.00 and $1.3154/€1.00, respectively. The banker offers to set up a forward hedge for selling the euro receivable for pound sterling based on the €/£ forward cross-exchange rate implicit in the forward rates against the dollar.What would you do if you were Mr. Peters?Suggested Solution to Shrewsbury Herbal Products, Ltd.Note to Instructor: This elementary case provides an intuitive look at hedging exchange rate exposure. Students should not have difficulty with it even though hedging will not be formally discussed until Chapter 8. The case is consistent with the discussion that accompanies Exhibit 5.9 of the text. Professor of Finance, Banikanta Mishra, of Xavier Institute of Management – Bhubaneswar, India contributed to this solution.Suppose Shrewsbury sells at a twenty percent markup. Thus the cost to the firm of the £320,000 order is £256,000. Thus, the pound could appreciate to €465,184/£256,000 = €1.8171/1.00 before all profit was eliminated. This seems rather unlikely. Nevertheless, a ten percent appreciation of the pound (€1.4537 x 1.10) to €1.5991/£1.00 would only yield a profit of £34,904 (= €465,184/1.5991 - £256,000). Shrewsbury can hedge the exposure by selling the euros forward for British pounds at F3(€/£) = F3($/£) ÷ F3($/€) = 1.8990 ÷ 1.3154 = 1.4437. At this forward exchange rate, Shrewsbury can “lock-in” a price of £322,217 (= €465,184/1.4437) for the sale. The forward exchange rate indicates that the euro is trading at a premium to the British pound in the forward market. Thus, the forward hedge allows Shrewsbury to lock-in a greater amount (£2,217) than if the euro receivable was converted into pounds at the current spotIf the euro was trading at a forward discount, Shrewsbury would end up locking-in an amount less than £320,000. Whether that would lead to a loss for the company would depend upon the extent of the discount and the amount of profit built into the price of £320,000. Only if the forward exchange rate is even with the spot rate will Shrewsbury receive exactly £320,000.Obviously, Shrewsbury could ensure that it receives exactly £320,000 at the end of three-month accounts receivable period if it could invoice in £. That, however, is not acceptable to the French wholesaler. When invoicing in euros, Shrewsbury could establish the euro invoice amount by use of the forward exchange rate instead of the current spot rate. The invoice amount in that case would be €461,984 = £320,000 x 1.4437. Shrewsbury can now lock-in a receipt of £320,000 if it simultaneously hedges its euro exposure by selling €461,984 at the forward rate of 1.4437. That is, £320,000 = €461,984/1.4437.。

商业银行管理彼得S.罗斯第八版课后答案chapter_01CHAPTER 1AN OVERVIEW OF BANKS AND THE FINANCIAL-SERVICES SECTORGoal of This Chapter: In this chapter you will learn about the many roles financial service providers play in the economy today. You will examine how and why the banking industry and the financial services marketplace as a whole is rapidly changing, becoming new and different as we move forward into the future. You will also learn about new and old services offered to the public.Key Topics in This ChapterPowerful Forces Reshaping the IndustryWhat is a Bank?The Financial System and Competing Financial-Service InstitutionsOld and New Services Offered to the PublicKey Trends Affecting All Financial-Service FirmsAppendix: Career Opportunities in Financial ServicesChapter OutlineI. I ntroduction: P owerful Forces Reshaping the IndustryII. W hat Is a Bank?A. D efined by the Functions It Serves and the Roles It Play:B. B anks and their Principal CompetitorsC. Legal Basis of a BankD. D efined by the Government Agency That Insures Its DepositsIII.The Financial System and Competing Financial-Service InstitutionsA.Savings AssociationsB.Credit UnionsC.Money Market FundsD.Mutual FundsE.Hedge FundsF.Security Brokers and DealersG.Investment BankersH.Finance CompaniesI.Financial Holding CompaniesJ.Life and Property/Casualty Insurance CompaniesIV. T he Services Banks and Many of Their Closest Competitors Offer the PublicA. S ervices Banks Have Offered Throughout History1.Carrying Out Currency Exchanges2.Discounting Commercial Notes and Making Business Loans3.Offering Savings Deposits4.Safekeeping of Valuables and Certification of Value5.Supporting Government Activities with Credit6.Offering Checking Accounts (Demand Deposits)7.Offering Trust ServicesB. S ervices Banks and Many of Their Financial-Service Competitors HaveOffered More Recently1.Granting Consumer Loans2.Financial Advising3.Managing Cash4.Offering Equipment Leasing5.Making Venture Capital Loans6.Selling Insurance Policies7.Selling Retirement PlansC. Dealing in Securities: Offering Security Brokerage and Investment Banking Services1. Offering Security Underwriting2. Offering Mutual Funds and Annuities3. Offering Merchant Banking Services4. Offering Risk Management and Hedging ServicesV. Key Trends Affecting All Financial-Service FirmsA. S ervice ProliferationB. R ising CompetitionC. G overnment DeregulationD. A n Increasingly Interest-Sensitive Mix of FundsE. T echnological Change and AutomationF. C onsolidation and Geographic ExpansionG. C onvergenceH. G lobalizationVI. T he Plan of This BookVII. S ummaryConcept Checks1-1. What is a bank? How does a bank differ from most other financial-service providers?A bank should be defined by what it does; in this case, banks are generally those financial institutions offering the widest range of financial services. Other financial service providers offer some of the financial services offered by a bank, but not all of them within one institution.1-2. Under U.S. law what must a corporation do to qualify and be regulated as a commercial bank?Under U.S. law, commercial banks must offer two essential services to qualify as banks for purposes of regulation and taxation, demand (checkable) deposits and commercial loans.More recently, Congress defined a bank as any institution that could qualify for deposit insurance administered by the FDIC.1-3.Why are some banks reaching out to become one-stop financial service conglomerates? Is this a good idea in your opinion?There are two reasons that banks are increasingly becoming one-stop financial service conglomerates. The first reason is the increased competition from other types of financial institution s and t he erosion of banks’ traditional service areas. The second reason is the Financial Services Modernization Act which has allowed banks to expand their role to be full service providers.1-4. Which businesses are banking’s closest and toughest com petitors? What services do they offer that compete directly with banks’ services?Among a bank’s closest competitors are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies, and life and property-casualty insurance companies. All of these financial service providers are converging and embracing each other’s innovations. The Financial Services Modernization Act has allowed many of these financial service providers to offer the public one-stop shopping for financial services.1-5. What is happening to banking’s share of the financial mark etplace and why? What kind of banking and financial system do you foresee for the future if present trends continue?The Financial Services Modernization Act of 1999 allowed many of the banks’ closest competitors to offer a wide array of financial services thereby taking away market share from “traditional” banks. Banks and their closest competitors areconverging into one-stop shopping for financial services and this trend should continue in the future1-6. What different kinds of services do banks offer the public today? What services do their closest competitors offer?Banks offer the widest range of services of any financial institution. They offer thrift deposits to encourage saving and checkable (demand) deposits to provide a means of payment for purchases of goods and services. They also provide credit through direct loans, by discounting the notes that business customers hold, and by issuing credit guarantees. Additionally, they make loans to consumers for purchases of durable goods, such as automobiles, and for home improvements, etc. Banks also manage the property of customers under trust agreements and manage the cash positions of their business customers. They purchase and lease equipment to customers as an alternative to direct loans. Many banks also assist their customers with buying and selling securities through discount brokerage subsidiaries, the acquisition and sale of foreign currencies, the supplying of venture capital to start new businesses, and the purchase of annuities to supply future funding at retirement or for other long-term projects such as supporting a college education. All of these services are also offered by their closest competitors. Banks and their closest competitors are converging and becoming the financial department stores of the modern era.1-7. What is a financial department store? A universal bank? Why do you think these institutions have become so important in the modern financial system? Financial department store and universal bank refer to the same concept. A financial department store is an institution where banking, fiduciary, insurance, and security brokerage services are unified under one roof. A bankthat offers all these services is normally referred to as a universal bank. These have become important because of convergence and changes in regulations that have allowed financial service providers to offer all services under one roof1-8. Why do banks and other financial intermediaries exist in modern society, according to the theory of finance?There are multiple approaches to answering this question. The traditional view of banks as financial intermediaries sees them as simultaneously fulfilling the financial-service needs of savers (surplus-spending units) and borrowers(deficit-spending units), providing both a supply of credit and a supply of liquid assets. A newer view sees banks as delegated monitors who assess and evaluate borrowers on behalf of their depositors and earn fees for supplying monitoring services. Banks also have been viewed in recent theory as suppliers of liquidity andtransactions services that reduce costs for their customers and, through diversification, reduce risk. Banks are also critical in the payment system for goods and services and have played an increasingly important role as a guarantor and a risk management role for customers.1-9. How have banking and the financial services market changed in recent years? What powerful forces are shaping financial markets and institutions today? Which of these forces do you think will continue into the future?Banking is becoming a more volatile industry due, in part, to deregulation which has opened up individual banks to the full force of the financial marketplace. At the same time the number and variety of banking services has increased greatly due to the pressure of intensifying competition from nonbank financial-service providers and changing public demand for more conveniently and reliably provided services. Adding to the intensity of competition, foreign banks have enjoyed success in their efforts to enter countries overseas and attract away profitable domestic business and household accounts.1-10. Can you explain why many of the forces you named in the answer to the previous question have led to significant problems for the management of banks and other financial firms and their stockholders?The net result of recent changes in banking and the financial services market has been to put greater pressure upon their earnings, resulting in more volatile returns to stockholders and an increased bank failure rates. Some experts see banks' role and market share shrinking due to restrictive government regulations and intensifying competition. Institutions have also become more innovative in their service offerings and in finding new sources of funding, such as off-balance-sheet transactions. The increased risk faced by institutions today, therefore, has forced managers to more aggressively utilize a wide array of tools and techniques to improve and stabilize their earnings streams and manage the various risks they face. 1-11. What do you think the financial services industry will look like 20 years from now? What are the implications of your projections for its management today? There appears to be a trend toward continuing consolidation and convergence. There are likely to be fewer financial service providers in the future and many of these will be very large and provide a broad range of financial services under one roof. In addition, global expansion will continue and will be critical to the survival of many financial service providers. Management of financial service providers willhave to be more technologically astute and be able to make a more diverse set of decisions including decisions about mergers, acquisitions and global expansion as well as new services to add to the firm.Problems and Projects1. You have just been hired as the marketing officer for the new First National Bank of Vincent, a suburban banking institution that will soon be serving a local community of 120,000 people. The town is adjacent to a major metropolitan area with a total population of well over 1 million. Opening day for the newly chartered bank is just two months away, and the president and the board of directors are concerned that the new bank may not be able to attract enough depositors and good-quality loan customers to meet its growth and profit projections. There are 18 other financial-service competitors in town, including two credit unions, three finance companies, four insurance agencies, and two security broker offices. Your task is to recommend the various services the bank should offer initially to build up an adequate customer base. You are asked to do the following:a.Make a list of all the services the new bank could offer, according to current regulations.b.List the type of information you will need about the local community tohelp you decide which of the possible services are likely to have sufficientdemand to make them profitable.c.Divide the possible services into two groups--those you think are essentialto customers and should be offered beginning with opening day, and thosethat can be offered later as the bank grows.d. Briefly describe the kind of advertising campaign you would like to run tohelp the public see how your bank is different from all the other financialservice providers in the local area. Which services offered by the nonblankservice providers would be of most concern to the new bank’smanagement?Banks can offer, if they choose, a wide variety of financial services today. These services are listed below. However, unless they are affiliated with a larger bank holding company and can offer some of these services through that company, it may be more limited in what it can offer.Regular Checking Accounts Management Consulting Services NOW Accounts Letters of CreditPassbook Savings Deposits Business Inventory Loans Certificates of Deposit Asset-Based Commercial Loans Money Market Deposits Discounting of Commercial Paper Automobile Loans Plant and Equipment Loans Retirement Savings Plans Venture Capital LoansNonauto Installment Loans to IndividualsResidential Real Estate Loans Leasing Plans for Business Property and EquipmentHome Improvement Loans Security Dealing and Underwriting Personal Trust Management Services Discount Security BrokerageCommercial Trust Services Institutional Trust Services Foreign Currency Trading and ExchangePersonal Financial Advising Personal Cash-Management ServicesInsurance Policy Sales (Mainly Credit-Life)Insurance Today (Except in Some States)) Standby Credit Guarantees Acceptance FinancingTo help the new bank decide which services to offer it would be helpful to gather information about some of the following items in the local community:School Enrollments and Growth in School EnrollmentsEstimated Value of Residential and Commercial PropertyRetail SalesPercentage of Home Ownership Among Residents in the AreaNumber and Size (in Sales and Work Force) of Local Business Establishments Major Population Locations (i.e., Major Subdivisions, etc.) and Any Projected Growth AreasPopulation Demographics (i.e., Age Distribution of the Area) Projected Growth Areas of Industries in the AreaEssential services the bank would probably want to offer right from the beginning includes:Regular Checking Accounts Home Improvement Loans Automobile and other Consumer-type Money Market Deposit Accounts Installment Loans Retirement Savings Plans NOW Accounts Business Inventory LoansPassbook Savings Deposits Discounting of High-QualityCommercial NotesResidential Real Estate LoansCertificates of DepositAs the bank grows, opportunities for the profitable sale of additional services usually increase, especially for trust servicesfor individuals and smaller businesses and personal financial advising as well as some commercial (plant and equipment) loans and leases. Further growth may result in the expansion of commercial trust services as well as a widening variety of commercial loans and credit guarantees.The bank would want to develop an advertising campaign that sends a message to potential customers that the new bank is, indeed, different from its competitors. Small banks often have the advantage of offering highly personalized services in which their customers are known and recognized and services are tailored to each individual customer's special financial needs. Quality and reliability of banking service are often more important to individual customers than is price. A new bank must try to sell prospective customers, most of who will come from other banks in the area, on personalized services, quality, and reliability - all three of which should be emphasized in its advertising program.2. Leading money center banks in the United States have accelerated their investment banking activities all over the globe in recent years, purchasing corporate debt securities and stock from their business customers and reselling those securities to investors in the open market. Is this a desirable move by these banking organizations from a profit standpoint? From a risk standpoint? From the public interest point of view? How would you research their question? If you were managing a corporation that had placed large deposits with a bank engaged in such activities, would you be concerned about the risk to your company's funds? What could you do to better safeguard those funds?In the 1970's and early 1980's investment banking was soprofitable that commercial bankers were lured into the investment banking business largely because of its greater profit potential than possessed by more traditional commercial banking activities. Later foreign banks, particularly the British and Japanese banking firms, began to attract away large corporate customers from U.S. banks, who were restrained by regulation from offering many investment banking services. Thus, U.S. banks ran into severe difficulty in simply trying to hold onto their traditional corporate credit and deposit accounts because they could not compete service-wise in the investment banking field. Today, banks are allowed to underwrite securities through either a subsidiary or through a holding company structure. This change occurred as part of the Gramm-Leach-Bliley Act (Financial Services Modernization Act).Unfortunately, if investment banking is more profitable than traditional banking product lines, it is also more risky, consistent with the basic tenet of finance that risk and return are directly related. That is why the Federal Reserve Board has placed such strict limits on the type of organization that can offer these services. Currently, the underwriting of most corporate securities must be done through a subsidiary or as a separate part of the holding company so that, in theory at least, the bank is not responsible for any losses incurred. For this reason there may be little reason for depositors (including large corporate depositors) to be concerned about risk exposure from investment banking. Moreover, the ability to offer such services may make U.S. banks more viable in the long run which helps their corporate customers who depend upon them for credit.On the other hand, opponents of investment banking powers for bank operations inside the U.S. have some reasonableconcerns that must be addressed. There are, for example, possible conflicts of interest. Information gathered in the investment banking division could be used to the detriment of customers purchasing other bank services. For example, a customer seeking a loan may be told that he or she must buy securities from the bank's investment banking division in order to receive a loan. Moreover, banks could gain effective control over some nonblank industrial corporations which might subject them to added risk exposure and place industrial firms not allied with banks at a competitive disadvantage. As a result the Gramm-Leach-Bliley Act has built in some protections to prevent this from happening.3. The term bank has been applied broadly over the years to include a diverse set of financial-service institutions, which offer different financial service packages.Identify as many o f the different kinds of “banks” as you can. How do the “banks” y ou have identified compare to the largest banking group of all – the commercial banks? Why do you think so many different financial firms have been called banks? How might this terminological confusion affect financial-service customers?The general public tends to classify anything as a bank that offers some sort of financial service, especially deposit and loan services. Other institutions that are often referred to as a bank without being one are savings associations, credit unions, money market funds, mutual funds, hedge funds, security brokers and dealers, investment banks, finance companies, financial holding companies and life and property/casualty insurance companies. All of these institutions offer some of the services that a commercial bank offers, but generally not the entire scope ofservices. Since providers of financial services are normally called banks by the general public they are able to take away business from traditional banks and it is of utmost importance for commercial banks to clarify their unique position among financial services providers.4. What advantages can you see to banks affiliating with insurance companies? How might such an affiliation benefit a bank? An insurer? Can you identify any possible disadvantages to such an affiliation? Can you cite any real world examples of bank-insurer affiliations? How well do they appear to have worked out in practice?Before Glass-Steagall banks used to sell insurance services to their customers on a regular basis. in particular, banks would sell life insurance companies to loan customers to ensure repayment of the loan in case of death or disablement. These reasons still exist today and the right to sell insurances to customers again benefits banks in allowing them to offer their customers complete financial packages from financing the home or car to insure it, from giving investment advice to selling life insurance policies and annuities for retirement planning. Generally, a bank customer who is already purchasing a service from a bank might feel compelled to purchase an insurance product, as well. On the other hand, insurance companies sometimes have a negative image, which makes it more difficult to sell certain insurance products. Combining their products with the trust that people generally have in banks will make it easier for them to sell their products. The most prominent example of a bank-insurer affiliation is the merger of Citicorp and Traveler’s Insurance to Citigroup. However, given that Citigroup has sold Traveler’s Insurance indicates that the anticipated synergy effects did notmaterialize.5. Explain the difference between consolidation and convergence. Are these trends in banking and financial services related? Do they influence each other? How? Consolidation refers to increase in the size of financial institutions and the decline in the number of small independently owned banks and financial service providers. Convergence is the bringing together of firms from different industries to createconglomerate firms offering multiple services. Clearly, these two trends are related. In their effort to compete with each other, banks and their closest competitors have acquired other firms in their industry as well across industries to provide multiple financial services in multiple markets.6. What is a financial intermediary? What are their key characteristics? Is a bank a type of financial intermediary? Why? What other financial-services companies are financial intermediaries? What important role within the financial system do financial intermediaries play?A financial intermediary is a business that interacts with deficit spending individuals and institutions and surplus spending individuals and institutions. For that reason any financial service provider (including banks) is considered a financial intermediary. In their function as intermediaries they act as a bridge between the deficit and surplus spending units by offering financial services to the surplus spending individuals and then loaning those funds to the deficit spending individuals. Financial intermediaries accelerate economic growth by increasing the pool of available funds and lowering the risk of investments through diversification.。

如何认知私募基金价值如何认知私募基金私募基金(Privately Offered Fund)是指一种针对少数投入者而私下(非公开)地募集资金并成立运作的投入基金，因此它又被称为向特定对象募集的基金或“地下基金”，其方式基本有两种：一是基于签订委托投入合同的契约型集合投入基金，二是基于共同出资入股成立股份企业的企业型集合投入基金。

私募基金的紧要构成形式是对冲基金(Hedge Fund)，是为谋取最大回报的投入者而设计的合伙制私募发行的投入工具。

对冲基金与共同基金(Mutual Fund)区别,后者一般是公募发行，须公开投入组合并接受公开监管，对冲基金因其合伙私人投入性质，不受政府管制，但并不意味着其不受任何监督;一般而言，外部有债权人(贷款银行)的监督，内部有合伙投入人的监督。

对冲基金虽数量与规模还比不上共同基金，但进展势头强劲，著名的如巴菲特掌管的基金、索罗斯量子基金和长期资本企业LTCM都是对冲基金。

私募基金的优点•投资灵活性高：可以采取更为灵活的投资策略和运作方式，比如可以进行杠杆投资、股权投资等。

•投资回报高：由于投资门槛高，一般只面向高净值投资者，私募基金的投资回报通常较公募基金更高。

私募基金的缺点•投资风险高：由于投资门槛高、投资策略灵活，私募基金的投资风险相对较高。

•投资周期长：私募基金的投资期限通常为3年以上，投资者需要有足够的耐心等待回报。

•信息披露不足：由于私募基金的投资门槛高，一般只面向高净值投资者，因此信息披露不如公募基金透明。

此外，私募基金的管理费和绩效报酬相对较高，对投资者的收益产生一定的压制。

私募基金的主要特点•投资门槛高：只面向机构投资者或个人高净值投资者，投资门槛一般为100万元以上。

•投资范围广：可以投资多种资产类型，比如股票、债券、房地产等。

•投资策略灵活：可以采取杠杆投资、股权投资等多种投资策略。

•投资期限长：通常为3年以上。

私募基金的运作方式私募基金的运作方式与公募基金有所不同。

CFA考试《CFA一级》历年真题精选及答案1122-331、An analyst does research about the reported revenue of a company and gathers thefollowing information about a product:Assume that the company bears no inventory risk for the product and uses net reportingof revenue, reported revenue of the product is closest to:【单选题】A.$50B.$90C.$100正确答案:C答案解析:net reported revenue = revenue - cost of goods sold = $140 - $40 = $100。

2、The following annual financial data are available for a company:Interest expense for the year is closest to:【单选题】A.71.6.B.97.4.C.109.2.正确答案:B答案解析:“Understanding Cash Flow Statements,” Elaine Henry, CFA, Thomas R. Robinson, CFA, Jan Hendrik van Greuning, CFA, and Michael A Broihahn, CFA2013 Modular Level I, Vol. 3, Section 3.2.1.5Study Session: 8-27-fDescribe the steps in the preparation of direct and indirect cash flow statements, including how cash flows can be computed using the income statement and balance sheet data.B is correct. Interest expense is equal to ending interest payable plus cash paid for interest less beginning interest payable. The calculation is as follows:3、A review of a company’s inventory records for the year indicates that the following costs were incurred:Fixed production overhead: $500,000Direct material and direct labor: 300,000Storage costs incurred during production: 25,000Abnormal waste costs: 30,000If the company operated at full capacity during the year, the total capitalized inventory cost is closest to:【单选题】A.$800,000.B.$825,000.C.$855,000.正确答案:B答案解析:“Inventories,” Michael A. Broihahn, CFA2011 Modular Level I, Vol. 3, pp. 379-380Study Session 9-36-aDistinguish between costs included in inventories and costs recognized as expenses in the period in which they are incurred.The total capitalized costs include fixed production costs, thedirect conversion costs of material and labor, storage costs required as part of production but not abnormal waste costs. $500,000 + 300,000 + 25,000 = $825,0004、The following table shows the volatility of a series of funds that belong to the same peer group, ranked in ascending order:The value of the first quintile is closest to:【单选题】A.10.70%.B.10.84%.C.11.09%正确答案:A答案解析:“Statistical Concepts and Market Returns,” Richard A. DeFusco, CFA, Dennis W. McLeavey, CFA, Jerald E. Pinto, CFA, and David E. Runkle, CFA2013 Modular Level I, Vol. 1, Reading 7, Section 6.1Study Session 2–7–fCalculate and interpret quartiles, quintiles, deciles, and percentiles.A is correct. First, find the position of the first quintile with the following formula:wherey is the percentage point at which we are dividing the distribution. In our case we have y = 20, which corresponds to thepercentile (first quintile);n is the number of observations (funds) in the peer group. In our case we have n = 13;Therefore, the location of the first quintile is between the volatility of Fund 2 and Fund 3 (because they are ranked in ascending order).Then, use linear interpolation to find the approximate value of the first quintile:where5、Duration is most accurate as a measure of interest rate risk for a bond portfolio when the slope of the yield curve:【单选题】A.increases.B.decreases.C.stays the same.正确答案:C答案解析:“Risks Associated with Investing in Bonds,” Frank J. Fabozzi2012 Modular Level I, Vol. 5, pp. 359–363Study Session 15-54-gDescribe yield-curve risk, and explain why duration does not account for yield-curve risk.C is correct because duration measures the change in the price of a portfolio of bonds if the yields for all maturities change by the same amount; that is, it assumes the slope of the yield curve stays the same.6、Umi Grabbo, CFA, is a highly regarded portfolio manager for Atlantic Advisors (AA), a mid-sized mutual fund firm investing in domestic securities. She has watched the hedge fund boom and on numerous occasions suggested her firm create such a fund. Senior management has refused to commit resources to the area. Attracted by potential higher fees associated with hedge funds, Grabbo and several other employees organize a hedge fund to invest in international securities. Grabbo is careful to work on the fund development only on her own time. Because AA management thinks hedge funds are a fad, she does not inform her supervisor about the hedge fund creation. According to the Standards of Practice Handbook, Grabbo should most likely address which of the Standards immediately?【单选题】A.Disclosure of Conflicts.B.Priority of Transactions.C.Additional Compensation Arrangements.正确答案:A答案解析:“Guidance for Standards I-VII”, CFA Institute2010 Modular Level I, Vol. 1, pp. 75, 89-92, 94-98Study Sessions 1-2-aDemonstrate a thorough knowledge of the Code of Ethics and Standards of Professional Conduct by applying the Code andStandards to situations involving issues of professional integrity. According to Standard VI (A) Disclosure of Conflicts, Grabbo should disclose to her employer the fact she is developing a hedge fund that could possibly interfere with her responsibilities at AA. In setting up a new fund, Grabbo was not acting for the benefit of her employer. She should have informed AA that she wanted to organize a hedge fund and come to some mutual agreement on how this would occur.7、Albert Nyakenda, CFA, was driving to a client’s office where he was expected to close a multi-million dollar deal, when he was pulled over by a traffic policeman When Nyakenda, realized the policeman planned to wrongly ticket him for speeding, he offered to buy him “lunch” so that he could quickly get to his client’s office. The alternative was to go to the police station and file a complaint of being wrongly accused that would also involve going to court the next day to present his case. The lunch would cost significantly more than the ticket. Did Nyakenda violate the CFA Code of Ethics?【单选题】A.Yes.B.No, because he was wrongly accused.C.No, because the cost of lunch is more than the ticket.正确答案:A答案解析:“Guidance for Standards I-VII”, CFA Institute2010 Modular Level I, Vol. 1, p. 11Study Session 1–2–a, bDemonstrate a thorough knowledge of the Code of Ethics and Standards of Professional Conduct by applying the Code and Standards to situations involving issues of professional integrity. Distinguish between conduct that conforms to the Code and Standards and conduct that violates the Code and Standards. Nyakenda was effectively trying to bribe the policeman so that he would not issue a speeding ticket. This action violates the Code of Ethics. Despite feeling he was wrongly accused, it is only his opinion, and may not based on fact or in a court of law. Nyakenda has a responsibility to act with integrity and in an ethical manual.8、Partial information on three baskets containing goods A andB is given in the table below. Themarginal rate of substitution of B for A,at Basket 2 is also provided.A consumer’s indifference curves are strictly convex and he claims that he is indifferent between Baskets 2 and 3. If he is also indifferent between Baskets 1 and 3, the number of units of A in basket 1 is most likely:【单选题】A.equal to 60.B.less than 60.C.greater than 60.正确答案:C答案解析:“Demand and Supply Analysis: Consumer Demand,” Richard V. Eastin and Gary L. Arbogast, CFA2013 Modular Level I, Vol. 2, Reading 14, Section 3.3, Example 2 Study Session 4–14–a, bDescribe consumer choice theory and utility theory.Describe the use of indifference curves, opportunity sets, and budget constraints in decision making.C is correct. Because the consumer is indifferent between all three baskets, they must all fall on the same indifference curve. Theat Basket 2 is 4, meaning that the slope of theindifference curve at that point is –4, henceSolve for A = 70: greater than60.9、Matthew Murphy, CFA, is an analyst at Divisadero Securities & Co..If Murphylives and works in a country where applicable laws differ from the requirement ofthe Code of Ethics and Standards of Professional Conduct,:【单选题】A.Murphy must comply to the applicable local law of the country.B.Murphy must comply to the Code of Ethics and Standards of ProfessionalConduct.C.Murphy must comply to the stricter of the applicable local law of the countryor the Code of Ethics and Standards of Professional Conduct.正确答案:C答案解析:在所适用的法律与伦理道德标准之间，CFA会员应该遵守更加严格的法律条例。

CHAPTER 5 THE MARKET FOR FOREIGN EXCHANGESUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTERQUESTIONS AND PROBLEMSQUESTIONS1. Give a full definition of the market for foreign exchange.Answer: Broadly defined, the foreign exchange (FX) market encompasses the conversion of purchasing power from one currency into another, bank deposits of foreign currency, the extension of credit denominated in a foreign currency, foreign trade financing, and trading in foreign currency options and futures contracts.2. What is the difference between the retail or client market and the wholesale or interbank market for foreign exchange?Answer: The market for foreign exchange can be viewed as a two-tier market. One tier is the wholesale or interbank market and the other tier is the retail or client market. International banks provide the core of the FX market. They stand willing to buy or sell foreign currency for their own account. These international banks serve their retail clients, corporations or individuals, in conducting foreign commerce or making international investment in financial assets that requires foreign exchange. Retail transactions account for only about 14 percent of FX trades. The other 86 percent is interbank trades between international banks, or non-bank dealers large enough to transact in the interbank market.3. Who are the market participants in the foreign exchange market?Answer: The market participants that comprise the FX market can be categorized into five groups: international banks, bank customers, non-bank dealers, FX brokers, and central banks. International banks provide the core of the FX market. Approximately 100 to 200 banks worldwide make a market in foreign exchange, i.e., they stand willing to buy or sell foreign currency for their own account. These international banks serve their retail clients, the bank customers, in conducting foreign commerce or making international investment in financial assets that requires foreign exchange. Non-bank dealers are large non-bank financial institutions, such as investment banks, mutual funds, pension funds, and hedge funds, whose size and frequency of trades make it cost- effective to establish their own dealing rooms totrade directly in the interbank market for their foreign exchange needs.Most interbank trades are speculative or arbitrage transactions where market participants attempt to correctly judge the future direction of price movements in one currency versus another or attempt to profit from temporary price discrepancies in currencies between competing dealers.FX brokers match dealer orders to buy and sell currencies for a fee, but do not take a position themselves. Interbank traders use a broker primarily to disseminate as quickly as possible a currency quote to many other dealers.Central banks sometimes intervene in the foreign exchange market in an attempt to influence the price of its currency against that of a major trading partner, or a country that it “fixes” or “pegs” its currency against. Intervention is the process of using foreign currency reserves to buy one’s own currency in order to decrease its supply and thus increase its value in the foreign exchange market, or alternatively, selling one’s own currency for foreign currency in order to increase its supply and lower its price.4. How are foreign exchange transactions between international banks settled?Answer: The interbank market is a network of correspondent banking relationships, with large commercial banks maintaining demand deposit accounts with one another, called correspondent bank accounts. The correspondent bank account network allows for the efficient functioning of the foreign exchange market. As an example of how the network of correspondent bank accounts facilities international foreign exchange transactions, consider a U.S. importer desiring to purchase merchandise invoiced in guilders from a Dutch exporter. The U.S. importer will contact his bank and inquire about the exchange rate. If the U.S. importer accepts the offered exchange rate, the bank will debit the U.S. importer’s account for the purchase of the Dutch guilders. The bank will instruct its correspondent bank in the Netherlands to debit its correspondent bank account the appropriate amount of guilders and to credit the Dutch exporter’s bank account. The importer’s bank will then debit its books to offset the debit of U.S. importer’s account, reflecting the decrease in its correspondent bank account balance.5. What is meant by a currency trading at a discount or at a premium in the forward market?Answer: The forward market involves contracting today for the future purchase or sale of foreign exchange. The forward price may be the same as the spot price, but usually it is higher (at a premium) or lower (at a discount) than the spot price.6. Why does most interbank currency trading worldwide involve the U.S. dollar?Answer: Trading in currencies worldwide is against a common currency that has international appeal. That currency has been the U.S. dollar since the end of World War II. However, the euro and Japanese yen have started to be used much more as international currencies in recent years. More importantly, trading would be exceedingly cumbersome and difficult to manage if each trader made a market against all other currencies.7. Banks find it necessary to accommodate their clients’ needs to buy or sell FX forward, in many instances for hedging purposes. How can the bank eliminate the currency exposure it has created for itself by accommodating a client’s forward transaction?Answer: Swap transactions provide a means for the bank to mitigate the currency exposure in a forward trade. A swap transaction is the simultaneous sale (or purchase) of spot foreign exchange against a forward purchase (or sale) of an approximately equal amount of the foreign currency. To illustrate, suppose a bank customer wants to buy dollars three months forward against British pound sterling. The bank can handle this trade for its customer and simultaneously neutralize the exchange rate risk in the trade by selling (borrowed) British pound sterling spot against dollars. The bank will lend the dollars for three months until they are needed to deliver against the dollars it has sold forward. The British pounds received will be used to liquidate the sterling loan.8. A CD/$ bank trader is currently quoting a small figure bid-ask of 35-40, when the rest of the market is trading at CD1.3436-CD1.3441. What is implied about the trader’s beliefs by his prices?Answer: The trader must think the Canadian dollar is going to appreciate against the U.S. dollar and therefore he is trying to increase his inventory of Canadian dollars by discouraging purchases of U.S. dollars by standing willing to buy $ at only CD1.3435/$1.00 and offering to sell from inventory at the slightly lower than market price of CD1.3440/$1.00.9. What is triangular arbitrage? What is a condition that will give rise to a triangular arbitrage opportunity?Answer: Triangular arbitrage is the process of trading out of the U.S. dollar into a second currency, then trading it for a third currency, which is in turn traded for U.S. dollars. The purpose is to earn an arbitrageprofit via trading from the second to the third currency when the direct exchange between the two is not in alignment with the cross exchange rate.Most, but not all, currency transactions go through the dollar. Certain banks specialize in making a direct market between non-dollar currencies, pricing at a narrower bid-ask spread than the cross-rate spread. Nevertheless, the implied cross-rate bid-ask quotations impose a discipline on the non-dollar market makers. If their direct quotes are not consistent with the cross exchange rates, a triangular arbitrage profit is possible.10. Over the past six years, the exchange rate between Swiss franc and U.S. dollar, SFr/$, has changed from about 1.30 to about 1.60. Would you agree that over this six-year period, the Swiss goods have become cheaper for buyers in the United States? (UPDATE? SF has gone from SF1.67/$ to SF1.04/$ over the last six years.)CFA Guideline Answer:The value of the dollar in Swiss francs has gone up from about 1.30 to about 1.60. Therefore, the dollar has appreciated relative to the Swiss franc, and the dollars needed by Americans to purchase Swiss goods have decreased. Thus, the statement is correct.PROBLEMS1. Using Exhibit 5.4, calculate a cross-rate matrix for the euro, Swiss franc, Japanese yen, and the Britishpound. Use the most current American term quotes to calculate the cross-rates so that the triangular matrix resulting is similar to the portion above the diagonal in Exhibit 5.6.Solution: The cross-rate formula we want to use is:S(j/k) = S($/k)/S($/j).The triangular matrix will contain 4 x (4 + 1)/2 = 10 elements.¥ SF £ $Euro 159.91 1.6317 .7478 1.4744 Japan (100) 1.0204.4676 .9220 Switzerland.4583 .9036 U.K 1.97172. Using Exhibit 5.4, calculate the one-, three-, and six-month forward cross-exchange rates between theCanadian dollar and the Swiss franc using the most current quotations. State the forward cross-rates in“Canadian” terms.Solution: The formulas we want to use are:F N (CD/SF) = F N ($/SF)/F N ($/CD)orF N (CD/SF) = F N (CD/$)/F N (SF/$).We will use the top formula that uses American term forward exchange rates.F 1(CD/SF) = .9052/.9986 = .9065F 3(CD/SF) = .9077/.9988 = .9088F 6(CD/SF) = .9104/.9979 = .91233. A foreign exchange trader with a U.S. bank took a short position of £5,000,000 when the $/£ exchange rate was 1.55. Subsequently, the exchange rate has changed to 1.61. Is this movement in the exchange rate good from the point of view of the position taken by the trader? By how much has the bank’s liability changed because of the change in the exchange rate? UPDATE TO CURRENT EX-RATES?CFA Guideline Answer:The increase in the $/£ exchange rate implies that the pound has appreciated with respect to the dollar. This is unfavorable to the trader since the trader has a short position in pounds.Bank’s liability in dollars initially was 5,000,000 x 1.55 = $7,750,000Bank’s liability in dollars now is 5,000,000 x 1.61 = $8,050,0004. Restate the following one-, three-, and six-month outright forward European term bid-ask quotes in forward points.1.3431-1.3436SpotOne-Month 1.3432-1.3442Three-Month 1.3448-1.3463Six-Month 1.3488-1.3508Solution:One-Month 01-06Three-Month 17-27Six-Month 57-725. Using the spot and outright forward quotes in problem 3, determine the corresponding bid-ask spreads in points.Solution:5SpotOne-Month 10Three-Month 15Six-Month 206. Using Exhibit 5.4, calculate the one-, three-, and six-month forward premium or discount for the Canadian dollar versus the U.S. dollar using American term quotations. For simplicity, assume each month has 30 days. What is the interpretation of your results?Solution: The formula we want to use is:f N,CD = [(F N($/CD) - S($/CD/$)/S($/CD)] x 360/Nf1,CD = [(.9986 - .9984)/.9984] x 360/30 = .0024f3,CD = [(.9988 - .9984)/.9984] x 360/90 = .0048f6,CD = [(.9979 - .9984)/.9984] x 360/180 = -.0060The pattern of forward premiums indicates that the Canadian dollar is trading at a premium versus the U.S. dollar for maturities up to three months into the future and then it trades at a discount.7. Using Exhibit 5.4, calculate the one-, three-, and six-month forward premium or discount for the U.S. dollar versus the British pound using European term quotations. For simplicity, assume each month has 30 days. What is the interpretation of your results?Solution: The formula we want to use is:f N,$ = [(F N (£/$) - S(£/$))/S(£/$)] x 360/Nf1,$ = [(.5076 - .5072)/.5072] x 360/30 = .0095f3,$ = [(.5086 - .5072)/.5072] x 360/90 = .0331f6,$ = [(.5104 - .5072)/.5072] x 360/180 = .0757The pattern of forward premiums indicates that the dollar is trading at a premium versus the British pound. That is, it becomes more expensive to buy a U.S. dollar forward for British pounds (in absolute and percentage terms) the further into the future one contracts.8. A bank is quoting the following exchange rates against the dollar for the Swiss franc and the Australian dollar:SFr/$ = 1.5960--70A$/$ = 1.7225--35An Australian firm asks the bank for an A$/SFr quote. What cross-rate would the bank quote?CFA Guideline Answer:The SFr/A$ quotation is obtained as follows. In obtaining this quotation, we keep in mind that SFr/A$ = SFr/$/A$/$, and that the price (bid or ask) for each transaction is the one that is more advantageous to the bank.The SFr/A$ bid price is the number of SFr the bank is willing to pay to buy one A$. This transaction (buy A$—sell SFr) is equivalent to selling SFr to buy dollars (at the bid rate of 1.5960 and the selling those dollars to buy A$ (at an ask rate of 1.7235). Mathematically, the transaction is as follows:bid SFr/A$ = (bid SFr/$)/(ask A$/$) = 1.5960/1.7235 = 0.9260The SFr/A$ ask price is the number of SFr the bank is asking for one A$. This transaction (sell A$—buy SFr) is equivalent to buying SFr with dollars (at the ask rate of 1.5970 and then simultaneously purchasing these dollars against A$ (at a bid rate of 1.7225). This may be expressed as follows:ask SFr/A$ = (ask SFr/$)/(bid A$/$) = 1.5970/1.7225 = 0.9271The resulting quotation by the bank isSFr/A$ = 0.8752—0.87639. Given the following information, what are the NZD/SGD currency against currency bid-ask quotations?AmericanTermsTerms EuropeanBidAskAskQuotations BidBankNew Zealand dollar .7265 .7272 1.3751 1.3765Singapore dollar .6135 .6140 1.6287 1.6300Solution: Equation 5.12 from the text implies S b(NZD/SGD) = S b($/SGD) x S b(NZD/$) = .6135 x 1.3751 = .8436. The reciprocal, 1/S b(NZD/SGD) =S a(SGD/NZD) = 1.1854. Analogously, it is implied that S a(NZD/SGD) = S a($/SGD) x S a(NZD/$) = .6140 x 1.3765 = .8452. The reciprocal, 1/S a(NZD/SGD) = S b(SGD/NZD) = 1.1832. Thus, the NZD/SGD bid-ask spread is NZD0.8436-NZD0.8452 and the SGD/NZD spread is SGD1.1832-SGD1.1854.10. Doug Bernard specializes in cross-rate arbitrage. He notices the following quotes:Swiss franc/dollar = SFr1.5971?$Australian dollar/U.S. dollar = A$1.8215/$Australian dollar/Swiss franc = A$1.1440/SFrIgnoring transaction costs, does Doug Bernard have an arbitrage opportunity based on these quotes? If there is an arbitrage opportunity, what steps would he take to make an arbitrage profit, and how would he profit if he has $1,000,000 available for this purpose.CFA Guideline Answer:A. The implicit cross-rate between Australian dollars and Swiss franc is A$/SFr = A$/$ x $/SFr = (A$/$)/(SFr/$) = 1.8215/1.5971 = 1.1405. However, the quoted cross-rate is higher at A$1.1.1440/SFr. So, triangular arbitrage is possible.B. In the quoted cross-rate of A$1.1440/SFr, one Swiss franc is worth A$1.1440, whereas the cross-rate based on the direct rates implies that one Swiss franc is worth A$1.1405. Thus, the Swiss franc is overvalued relative to the A$ in the quoted cross-rate, and Doug Bernard’s strategy for triangular arbitrage should be based on selling Swiss francs to buy A$ as per the quoted cross-rate. Accordingly, the steps Doug Bernard would take for an arbitrage profit is as follows:i.Sell dollars to get Swiss francs: Sell $1,000,000 to get $1,000,000 x SFr1.5971/$ =SFr1,597,100.ii.Sell Swiss francs to buy Australian dollars: Sell SFr1,597,100 to buy SFr1,597,100 x A$1.1440/SFr = A$1,827,082.40.iii.Sell Australian dollars for dollars: Sell A$1,827,082.40 for A$1,827,082.40/A$1.8215/$ = $1,003,064.73.Thus, your arbitrage profit is $1,003,064.73 - $1,000,000 = $3,064.73.11. Assume you are a trader with Deutsche Bank. From the quote screen on your computer terminal, you notice that Dresdner Bank is quoting €0.7627/$1.00 and Credit Suisse is offering SF1.1806/$1.00. You learn that UBS is making a direct market between the Swiss franc and the euro, with a current €/SF quote of .6395. Show how you can make a triangular arbitrage profit by trading at these prices. (Ignore bid-ask spreads for this problem.) Assume you have $5,000,000 with which to conduct the arbitrage. What happens if you initially sell dollars for Swiss francs? What €/SF price will eliminate triangulararbitrage?Solution: To make a triangular arbitrage profit the Deutsche Bank trader would sell $5,000,000 to Dresdner Bank at €0.7627/$1.00. This trade would yield €3,813,500= $5,000,000 x .7627. The Deutsche Bank trader would then sell the euros for Swiss francs to Union Bank of Switzerland at a price of €0.6395/SF1.00, yielding SF5,963,253 = €3,813,500/.6395. The Deutsche Bank trader will resell the Swiss francs to Credit Suisse for $5,051,036 = SF5,963,253/1.1806, yielding a triangular arbitrage profit of $51,036.If the Deutsche Bank trader initially sold $5,000,000 for Swiss francs, instead of euros, the trade would yield SF5,903,000 = $5,000,000 x 1.1806. The Swiss francs would in turn be traded for euros to UBS for €3,774,969= SF5,903,000 x .6395. The euros would be resold to Dresdner Bank for $4,949,481 = €3,774,969/.7627, or a loss of $50,519. Thus, it is necessary to conduct the triangular arbitrage in the correct order.The S(€/SF) cross exchange rate should be .7627/1.1806 = .6460. This is an equilibrium rate at which a triangular arbitrage profit will not exist. (The student can determine this for himself.) A profit results from the triangular arbitrage when dollars are first sold for euros because Swiss francs are purchased for euros at too low a rate in comparison to the equilibrium cross-rate, i.e., Swiss francs are purchased for only €0.6395/SF1.00 instead of the no-arbitrage rate of €0.6460/SF1.00. Similarly, when dollars are first sold for Swiss francs, an arbitrage loss results because Swiss francs are sold for euros at too low a rate, resulting in too few euros. That is, each Swiss franc is sold for €0.6395/SF1.00 instead of the higher no-arbitrage rate of €0.6460/SF1.00.12. The current spot exchange rate is $1.95/£ and the three-month forward rate is $1.90/£. Based on your analysis of the exchange rate, you are pretty confident that the spot exchange rate will be $1.92/£ in three months. Assume that you would like to buy or sell £1,000,000.a. What actions do you need to take to speculate in the forward market? What is the expected dollar profit from speculation?b. What would be your speculative profit in dollar terms if the spot exchange rate actually turns out to be $1.86/£.Solution:a. If you believe the spot exchange rate will be $1.92/£ in three months, you should buy £1,000,000 forward for $1.90/£. Your expected profit will be:$20,000 = £1,000,000 x ($1.92 -$1.90).b. If the spot exchange rate actually turns out to be $1.86/£ in three months, your loss from the long position will be:-$40,000 = £1,000,000 x ($1.86 -$1.90).13. Omni Advisors, an international pension fund manager, plans to sell equities denominated in Swiss Francs (CHF) and purchase an equivalent amount of equities denominated in South African Rands (ZAR).Omni will realize net proceeds of 3 million CHF at the end of 30 days and wants to eliminate the risk that the ZAR will appreciate relative to the CHF during this 30-day period. The following exhibit shows current exchange rates between the ZAR, CHF, and the U.S. dollar (USD).Currency Exchange RatesZAR/USD ZAR/USD CHF/USD CHF/USDMaturity Bid Ask Bid AskSpot 6.2681 6.2789 1.5282 1.534330-day 6.2538 6.2641 1.5226 1.528590-day 6.2104 6.2200 1.5058 1.5115a.Describe the currency transaction that Omni should undertake to eliminate currency riskover the 30-day period.b.Calculate the following:• The CHF/ZAR cross-currency rate Omni would use in valuing the Swiss equityportfolio.• The current value of Omni’s Swiss equity portfolio in ZAR.• The annualized forward premium or discount at which the ZAR is trading versus theCHF.CFA Guideline Answer:a.To eliminate the currency risk arising from the possibility that ZAR will appreciateagainst the CHF over the next 30-day period, Omni should sell 30-day forward CHF against 30-day forward ZAR delivery (sell 30-day forward CHF against USD and buy 30-day forward ZAR against USD).b.The calculations are as follows:• Using the currency cross rates of two forward foreign currencies and three currencies(CHF, ZAR, USD), the exchange would be as follows:--30 day forward CHF are sold for USD. Dollars are bought at the forward sellingprice of CHF1.5285 = $1 (done at ask side because going from currency intodollars)--30 day forward ZAR are purchased for USD. Dollars are simultaneously sold topurchase ZAR at the rate of 6.2538 = $1 (done at the bid side because going fromdollars into currency)--For every 1.5285 CHF held, 6.2538 ZAR are received; thus the cross currency rate is1.5285 CHF/6.2538 ZAR = 0.244411398.• At the time of execution of the forward contracts, the value of the 3 million CHFequity portfolio would be 3,000,000 CHF/0.244411398 = 12,274,386.65 ZAR.• To calculate the annualized premium or discount of the ZAR against the CHF requires comparison of the spot selling exchange rate to the forward selling price of CHF forZAR.Spot rate = 1.5343 CHF/6.2681 ZAR = 0.24477912030 day forward ask rate 1.5285 CHF/6.2538 ZAR = 0.244411398The premium/discount formula is:[(forward rate – spot rate) / spot rate] x (360 / # day contract) =[(0.244411398 – 0.24477912) / 0.24477912] x (360 / 30) =-1.8027126 % = -1.80% discount ZAR to CHFMINI CASE: SHREWSBURY HERBAL PRODUCTS, LTD.Shrewsbury Herbal Products, located in central England close to the Welsh border, is an old-line producer of herbal teas, seasonings, and medicines. Its products are marketed all over the United Kingdom and in many parts of continental Europe as well.Shrewsbury Herbal generally invoices in British pound sterling when it sells to foreign customers in order to guard against adverse exchange rate changes. Nevertheless, it has just received an order from a large wholesaler in central France for £320,000 of its products, conditional upon delivery being made in three months’ time and the order invoiced in euros.Shrewsbury’s controller, Elton Peters, is concerned with whether the pound will appreciate versus the euro over the next three months, thus eliminating all or most of the profit when the euro receivable is paid. He thinks this is an unlikely possibility, but he decides to contact the firm’s banker for suggestions about hedging the exchange rate exposure.Mr. Peters learns from the banker that the current spot exchange rate is €/£ is €1.4537, thus the invoice amount should be €465,184. Mr. Peters also learns that the three-month forward rates for the pound and the euro versus the U.S. dollar are $1.8990/£1.00 and $1.3154/€1.00, respectively. The banker offers to set up a forward hedge for selling the euro receivable for pound sterling based on the €/£ forward cross-exchange rate implicit in the forward rates against the dollar.What would you do if you were Mr. Peters?Suggested Solution to Shrewsbury Herbal Products, Ltd.Note to Instructor: This elementary case provides an intuitive look at hedging exchange rate exposure. Students should not have difficulty with it even though hedging will not be formally discussed until Chapter 8. The case is consistent with the discussion that accompanies Exhibit 5.9 of the text. Professor of Finance, Banikanta Mishra, of Xavier Institute of Management – Bhubaneswar, India contributed to this solution.Suppose Shrewsbury sells at a twenty percent markup. Thus the cost to the firm of the £320,000 order is £256,000. Thus, the pound could appreciate to €465,184/£256,000 = €1.8171/1.00 before all profit was eliminated. This seems rather unlikely. Nevertheless, a ten percent appreciation of the pound (€1.4537 x 1.10) to €1.5991/£1.00 would only yield a profit of £34,904 (= €465,184/1.5991 - £256,000). Shrewsbury can hedge the exposure by selling the euros forward for British pounds at F3(€/£) = F3($/£) ÷ F3($/€) = 1.8990 ÷ 1.3154 = 1.4437. At this forward exchange rate, Shrewsbury can “lock-in” a price of £322,217 (= €465,184/1.4437) for the sale. The forward exchange rate indicates that the euro is trading at a premium to the British pound in the forward market. Thus, the forward hedge allows Shrewsbury to lock-in a greater amount (£2,217) than if the euro receivable was converted into pounds at the current spotIf the euro was trading at a forward discount, Shrewsbury would end up locking-in an amount less than £320,000. Whether that would lead to a loss for the company would depend upon the extent of the discount and the amount of profit built into the price of £320,000. Only if the forward exchange rate is even with the spot rate will Shrewsbury receive exactly £320,000.Obviously, Shrewsbury could ensure that it receives exactly £320,000 at the end of three-month accounts receivable period if it could invoice in £. That, however, is not acceptable to the French wholesaler. When invoicing in euros, Shrewsbury could establish the euro invoice amount by use of the forward exchange rate instead of the current spot rate. The invoice amount in that case would be €461,984 = £320,000 x 1.4437. Shrewsbury can now lock-in a receipt of £320,000 if it simultaneously hedges its euro exposure by selling €461,984 at the forward rate of 1.4437. That is, £320,000 =€461,984/1.4437.。

金融方面的英语单词关于金融方面的英语单词引言：励志投身金融领域打算店铺读商科的'小伙伴们，以下店铺整理的这些关于金融方面的英语词汇大家可不能错过呀!division of labor 劳动分工commodity money 商品货币legal tender 法定货币fiat money 法定通货a medium of exchange交换媒介legal sanction法律制裁face value面值liquid assets流动资产illiquidl assets非流动资产the liquidity scale 流动性指标real estate 不动产checking accounts,demand deposit,checkable deposit 活期存款time deposit 定期存款negotiable order of withdrawal accounts 大额可转让提款单money market mutual funds 货币市场互助基金repurchase agreements 回购协议certificate of deposits存单bond 债券stock股票travelers'checks 旅行支票small-denomination time deposits小额定期存款large-denomination time deposits大额定期存款bank overnight repurchase agreements 银行隔夜回购协议bank long-term repurchase agreements 银行长期回购协议thrift institutions 存款机构financial institution 金融机构commercial banks商业银行a means of payment 支付手段a store of value储藏手段a standard of value价值标准reserve 储备note 票据discount贴现circulate流通central bank 中央银行the Federal Reserve System联邦储备系统credit union 信用合作社paper currency 纸币credit creation 信用创造branch banking 银行分行制unit banking 单一银行制out of circulation 退出流通capital stock股本at par以票面价值计electronic banking电子银行banking holding company 公司银行the gold standard金本位the Federal Reserve Board 联邦储备委员会the stock market crash 股市风暴reserve ratio 准备金比率deficit 亏损roll展期wholesale批发default不履约auction拍卖collateralize担保markup价格的涨幅dealer交易员broker经纪人pension funds 养老基金face amount面值commerical paper商业票据banker's acceptance银行承兑汇票Fed fund 联邦基金eurodollar欧洲美元treasury bills 国库券floating-rate 浮动比率fixed-rate 固定比率default risk 拖欠风险credit rating信誉级别tax collection税收money market货币市场capital market资本市场original maturity 原始到期期限surplus funds过剩基金syndication辛迪加underwrite包销，认购hedge对冲买卖、套期保值innovation到期交易spread利差principal本金swap掉期交易eurobond market 欧洲债券市场euronote欧洲票据Federal Reserve Bank (FRB)联邦储备银行unsecured credit无担保贷款fixed term time deposit定期支付存款lead bank牵头银行neogotiable time deposit议付定期存款inter-bank money market银行同业货币市场medium term loan 中期贷款syndicated credit银团贷款merchant bank商业银行portfolio management 有价债券管理lease financing租赁融资note issurance facility票据发行安排bearer note不记名票价underwriting facility包销安排floating-rate note 浮动利率票据bond holder债券持持有者London Interbank Offered Rate(LIBOR)伦敦同业优惠利率back-up credit line备用信贷额promissory note(P.N..p/n)本票revolving cerdit 循环信用证，即revolving letter of credit non interest-bearing reserves无息储备金interest rate controls 利率管制interest rate ceiling 利率上限interest rate floor 利率下限【关于金融方面的英语单词】。

CHAPTER 5 THE MARKET FOR FOREIGN EXCHANGESUGGESTED ANSWERS AND SOLUTIONS TO END—OF-CHAPTERQUESTIONS AND PROBLEMSQUESTIONS1. Give a full definition of the market for foreign exchange.Answer： Broadly defined, the foreign exchange (FX) market encompasses the conversion of purchasing power from one currency into another，bank deposits of foreign currency，the extension of credit denominated in a foreign currency，foreign trade financing, and trading in foreign currency options and futures contracts。

2. What is the difference between the retail or client market and the wholesale or interbank market for foreign exchange?Answer：The market for foreign exchange can be viewed as a two-tier market。

One tier is the wholesale or interbank market and the other tier is the retail or client market。

International banks provide the core of the FX market. They stand willing to buy or sell foreign currency for their own account. These international banks serve their retail clients, corporations or individuals, in conducting foreign commerce or making international investment in financial assets that requires foreign exchange. Retail transactions account for only about 14 percent of FX trades. The other 86 percent is interbank trades between international banks，or non—bank dealers large enough to transact in the interbank market。

《投资学（双语）》教学大纲课程编号：091333B课程类型：□通识教育必修课□通识教育选修课□专业必修课□√专业选修课□学科基础课总学时：48 讲课学时：48 实验（上机）学时：学分：3适用对象：资产评估先修课程：金融学1.教学目标（黑体，小四号字）投资学是随着我国金融市场的发展特别是资本证券市场的发展，高校为适应社会对从事金融证券投资业务活动的应用性专业人才不断扩大的需要而开设的一门课程。

本课程的教学目标是通过课堂教学，让学生系统地掌握投资领域的基本理论、熟悉金融工具的基本定价规律，在教学中立足开拓学生的国际视野，注重培养学生分析问题、解决问题的能力，为成为卓越评估师打下坚实的知识基础。

目标1：系统了解现代投资理论、原理和内在机制目标2：掌握各种金融工具的特点和定价规律。

目标3：在学习中注重培养学生分析问题、解决问题的能力。

2.教学内容及其与毕业要求的对应关系（黑体，小四号字）可包括但不限于：1.教学内容讲授上的要求精讲内容包括金融市场、基金、风险与收益、马克维茨投资组合理论、因素模型；粗讲投资过程、各种金融工具的特点。

2.教学方法、教学手段根据本课程的特点以及培养目标的要求，在教学中应遵循循序渐进、深入浅出的原则和理论与实践相结合的原则。

在课堂教学中以导读与释疑为主，教师以教学大纲为依据，以主要教材为蓝本，提要基本内容、识记基本概念、讲解基本原理、讲解重点难点，课下要求学生阅读大量投资领域相关文献以加深对课程所授知识的理解深度。

3.对课后作业以及学生自学的要求本课程在学习中将安排4-5次课外综合作业，重点考察学生所学知识的掌握程度。

对于一些容易理解的知识点放置课下学习，为学生提供探索与思考的空间。

4.该课程从哪些方面促进了毕业要求的实现（1）本课程学习可以帮助学生金融市场的运行规律，能够采用科学的方法从金融市场中搜集相关数据与信息并进行和分析处理，进而形成恰当投资决策；（2）本课程学习可以帮助学生逐渐形成团队协作意识，并在资产评估团队活动中发挥个人能力，同时与其他成员进行协调合作；（3）本课程学习可以帮助学生养成自主学习和终身学习意识，培养其创业创新能力及不断学习与适应发展的能力。

Portfolio ManagementPortfolio Management: An OverviewDescribe the portfolio approach to investing1.The portfolio perspective refers to evaluating individual investments by theircontribution on the risk and return of an investor’s portfolio.投资组合视角指的是通过投资组合对风险和回报的贡献来评估个人投资。

2.把所有钱用于买一只股票并不是一种portfolio perspective，把钱分散在多只证券中才能降低风险，增加收益。

3.One measure of the benefits of diversification is the diversification ratio. It iscalculated as the ratio of the risk of an equally weighted portfolio of n securities to the risk of a single security selected at random from the n securities.衡量多样化的好处之一是多样化比率。

它计算的是n证券等加权组合的风险与随机从n证券中选择的单一证券的风险之比。

4.If the average standard deviation of returns for the n stocks is 25%, and thestandard deviation of returns for an equally weighted portfolio of the n stocks is 18%, the diversification ratio is 18/25=0.72.Describe types of investors and distinctive characteristics and needs of each1.Individual investor个人投资者就是个人为了满足生活目标而进行理财的投资者，是牺牲当前消费以期获得未来更高水平消费的个人。

和投资有关的英语作文Investment is an important aspect of financial planning and wealth management. It involves putting money into financial assets with the expectation of generating a return or profit over time. There are various types of investments, including stocks, bonds, real estate, and mutual funds, each with its own level of risk and potential for return.One of the most common forms of investment is in the stock market. When individuals buy shares of a company, they become partial owners of that company and have the potential to benefit from its growth and success. However, investing in stocks also comes with the risk of losing money if the company's performance falters.Another popular investment option is bonds, which are debt securities issued by governments, municipalities, or corporations. When investors purchase bonds, they are essentially lending money to the issuer in exchange forperiodic interest payments and the return of the bond's face value at maturity. Bonds are generally considered to be less risky than stocks, but they also offer lower potential returns.Real estate is another avenue for investment, as it involves purchasing property with the expectation of generating rental income or selling the property at a higher price in the future. Real estate investments can provide a steady stream of income and the potential for long-term appreciation, but they also require ongoing maintenance and management.Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversifiedportfolio of stocks, bonds, or other securities. By spreading their investments across a range of assets, mutual fund investors can reduce their risk exposure and potentially achieve more stable returns.In addition to these traditional investment options, there are also alternative investments such as commodities,hedge funds, and private equity. These investments often require a higher level of expertise and may be moresuitable for sophisticated investors with a higher risk tolerance.When considering investment opportunities, it is important for individuals to assess their risk tolerance, investment goals, and time horizon. They should also carefully research and understand the potential risks and rewards of each investment option before making any decisions. Diversifying one's investment portfolio is also crucial for managing risk and maximizing potential returns.In conclusion, investment is a key component of financial planning and can play a significant role in building wealth over time. By understanding the various investment options available and carefully evaluating their potential risks and rewards, individuals can make informed decisions to help achieve their financial goals.。