Important Points for IC 99 - Asset Management Exam
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Factors influencing Spot Rates and Forward Rates are subject to following three conditions : Interest rate parity, purchasing power parity and International Fisher Effect
Exchange rate quotation is the rate at which the currency of one country is exchanged for or converted into the currency of another country. There are two types of market quotations : direct quotation and indirect quotation.
Bid is the price at which the dealer is willing to buy another currency. Offer is the rate at which he is willing to sell another currency. The difference between bid and offer is "Spread". The offer is always higher than the bid as the inter-bank dealers make money by buying at the bid and selling at the offer.
Cross rates : It refers to the Exchange Rate which is expressed by a pair of currencies in which none of the currencies is the currency of the country.
The objective of the (FEMA) is to consolidate and amend the law ralating to foreign exchange with the objective of facilitating external trade and payments for promoting the orderly development and maintenance of foreign exchange market in India.
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