Second, foreign exchange investors in order to obtain speculative profits. Frequent and violent exchange rate fluctuations will create powerful conditions for foreign exchange speculators to speculate in foreign exchange, especially under the floating exchange rate system. Foreign exchange speculation refers to the use of exchange rate fluctuations in the foreign exchange market, purely for profit. Short-term investors make an appointment to buy and sell futures to avoid risks. If there is no foreign exchange control and the interest rate of one country is lower than that of other countries, then the funds of that country will flow to other countries to seek benefits.
Three. Transactions conducted by foreign exchange banks to balance forward foreign exchange reserves. Forward foreign exchange holdings are also called foreign exchange positions. In order to avoid foreign exchange risks, importers and exporters conduct forward foreign exchange transactions, which essentially transfer the risk of exchange rate changes to foreign exchange banks. In order to balance foreign exchange positions, foreign exchange banks will cover positions with different maturities and currencies.
Forward foreign exchange trading has the following advantages and disadvantages. After the contract is signed, both parties do not need to pay foreign exchange or local currency immediately, but pay later. The amount and scale of trading funds are relatively large.
The main purpose of buying and selling is to preserve value and avoid the risk of exchange rate fluctuation. The contracts signed between foreign exchange banks and customers shall be guaranteed by foreign exchange brokers.
6. Customers should deposit a certain margin or collateral, and the role of forward foreign exchange transactions: Forward foreign exchange transactions are generated due to the needs of international trade. Its main function is to avoid exchange rate risks in international trade. In international trade activities, importers and exporters expect to pay or collect a certain amount of foreign exchange on a specific date in the future. C 1 In order to avoid the increase of foreign exchange expenditure or the decrease of foreign exchange income caused by exchange rate fluctuation, the company can conduct forward foreign exchange transactions according to the most expected foreign exchange cash flow. And achieve the purpose of hedging.
Reasons for conducting forward foreign exchange transactions. Foreign exchange investors hope to make speculative profits. Frequent and violent exchange rate fluctuations will create powerful conditions for foreign exchange speculators to speculate in foreign exchange, especially under the floating exchange rate system. Foreign exchange speculation refers to the use of exchange rate fluctuations in the foreign exchange market, purely for profit;
8. Short-term investors make an appointment to buy and sell futures to avoid risks. If there is no foreign exchange control and the interest rate of a country is lower than that of other countries, then the funds of that country will flow to other countries to seek benefits; Transactions conducted by foreign exchange banks to balance forward foreign exchange reserves. Forward foreign exchange holdings are also called foreign exchange positions. In order to avoid foreign exchange risks, importers and exporters conduct forward foreign exchange transactions, which essentially transfer the risk of exchange rate changes to foreign exchange banks. In order to balance foreign exchange positions, foreign exchange banks will cover positions with different maturities and currencies.