Interest rate parity is a no-arbitrage condition representing an equilibrium state under which investors compare interest rates available on bank deposits...

exchange rate S t {\displaystyle S_{t}} is the spot exchange rate Combining the International Fisher effect with covered interest rate parity yields the...

between two countries' interest rates. The opportunity to earn riskless profits arises from the reality that the interest rate parity condition does not constantly...

rate for hedging purposes. The forward exchange rate is determined by a parity relationship among the spot exchange rate and differences in interest rates...

Unofficial transactions of this nature may be illegal. Uncovered interest rate parity (UIRP) states that an appreciation or depreciation of one currency...

full." The formal model underlying the hypothesis is the uncovered Interest Rate Parity condition which states that in absence of a risk premium, arbitrage...

In finance, an interest rate swap (IRS) is an interest rate derivative (IRD). It involves exchange of interest rates between two parties. In particular...

from the reality that the uncovered interest rate parity condition does not constantly hold—that is, the interest rate on investments in one country's currency...

Look up parity in Wiktionary, the free dictionary. Parity may refer to: Parity bit in computing, sets the parity of data for the purpose of error detection...

an interest rate swap which involves the exchange of two floating rate financial instruments. A basis swap functions as a floating-floating interest rate...

charge Convenience yield Covered interest arbitrage Demurrage currency Endaka Interest rate parity Spot-future parity Carry, SSRN, April 2014 Maturity-transformation:...

and exchange rate may differ from the market exchange rate because of tariffs, and other transaction costs. The purchasing power parity indicator can...

an interest rate cap is a type of interest rate derivative in which the buyer receives payments at the end of each period in which the interest rate exceeds...

Mundell–Fleming model, the optimum currency area theory, purchasing power parity, interest rate parity, and the international Fisher effect. Whereas the study of international...

expected depreciation in the currencies relative to each other (see interest rate parity). Arbitrage transactions in modern securities markets involve fairly...

exchange rates in a floating exchange rate regime, including: International parity conditions: Relative purchasing power parity, interest rate parity, Domestic...

in asset markets holds, via the uncovered interest parity equation, and that expectations of exchange rate changes are "consistent": that is, rational...

estimated. Carry (investment) Carrying charge Interest rate parity Covered interest arbitrage Spot-future parity Contango Demurrage currency Managed Futures...

Cross currency swap Foreign exchange market Forward exchange rate Interest rate parity Overnight indexed swap Rollover (foreign exchange) Reuters Glossary...

Spot–future parity (or spot-futures parity) is a parity condition whereby, if an asset can be purchased today and held until the exercise of a futures...

at historical exchange rates. If foreign-exchange markets are efficient—such that purchasing power parity, interest rate parity, and the international...

century, financier Russell Sage used put-call parity to create synthetic loans, which had higher interest rates than the usury laws of the time would have...

Grid parity (or socket parity) occurs when an alternative energy source can generate power at a levelized cost of electricity (LCOE) that is less than...

induce any investors to hold it. In practice, to infer the risk-free interest rate in a particular currency, market participants often choose the yield...

for the currency exchange rate. To participate in the European Monetary System, Ireland chose to break the Irish pound's parity with sterling in 1979, because...

Low-density parity-check (LDPC) codes are a class of error correction codes which (together with the closely-related turbo codes) have gained prominence...

Risk parity (or risk premia parity) is an approach to investment management which focuses on allocation of risk, usually defined as volatility, rather...

Interest-rate targeting is generally the primary tool, being obtained either directly via administratively changing the central bank's own interest rates...

finance, interest rate immunization is a portfolio management strategy designed to take advantage of the offsetting effects of interest rate risk and...

restricted and controlled by government. See capital control. Interest rate parity and Covered interest arbitrage: The simple concept that two similar investments...