Sentences with phrase «rate arbitrage»

In the past, I would merely just take advantage of the interest rate arbitrage and park the money in a CD or savings account.

Create a nice simple interest rate arbitrage and watch the equity in your home actually start contributing to your retirement.

This is called interest rate arbitrage and it is one way in which banks make money, but there is no reason for you not to do it.

It's also known as interest - rate arbitrage.

This is what I meant earlier when I mentioned playing «interest rate arbitrage» with the IRS.

The profits came from financial innovation — mainly in mortgage securities and interest - rate arbitrage.

Except 1H13, when the abnormally high growth of exports may have been due to false foreign trade to take advantage of interest rate arbitrage, US GDP Y / Y and China's exports Y / Y are correlated.

Banks now lend mainly to other financial institutions, hedge funds, corporate raiders, insurance companies and real estate, and engage in their own speculation in foreign currency, interest - rate arbitrage, and computer - driven trading programs.

These lower rates provide a limited opportunity to help some clients profit from tax - rate arbitrage by capitalizing on the spread between 2017 and 2018...

China will have to impose capital controls to prevent interest - rate arbitrage from flowing into its currency out of the dollar

In our view, t he Fed would be highly likely to adjust the policy rate upwards in this situation to avoid further market distortions and a potential explosion in carry trade and other counterproductive rate arbitrage activity.

Not exact matches

The variability between rates across Canadian exchanges was enough to make an instant 2 - 3 % return through arbitrage (minus the extortionate fee you'd have to pay to transfer funds between exchanges).

It is important to note, in this regard, that international arbitrage does not require complete interest rate equalization, just the equalization of (risk - adjusted) rates of return, including anticipated moves in the exchange rate.

No analysis on how systematic wage arbitrage allowed by trade globalization between countries of very different income level within an exchange rate system allowing massive an persistent trade imbalances led to a massive opening up of compensation scales in developed countries, as well as substantial under - employment.

Repeating the foreign - exchange turbulence of the 1930s hardly seems to be an attractive alternative, for it is hard to see how Europe might adopt dual exchange rates, one for trade and another for capital movements, in a way that would not provide opportunities for financial arbitrage.

Last quarter, high corporate cash levels, low interest rates, and merger deal spreads remaining at healthy levels served as a good tailwind to merger arbitrage.

In the non-system of floating exchange rates not balancing cross external accounts, this global trade liberalization has opened vast opportunities for cost arbitrage at the expense of workers in higher cost developed countries.

Under these conditions the maneuvering for quick returns by banks and their arbitrage customers is distorting exchange rates for international trade.

Meanwhile, some of the external factors that helped to drive profit growth in the past three decades, such as global labor arbitrage and falling interest rates, are reaching their limits.

To understand the dynamics at work, one needs to look at the balance of payments — not so much the balance of trade itself, but the currency speculation, international lending and arbitrage that has dominated exchange rates over the past two decades.

Today, they reflect the flow of international borrowing where interest rates are low and lending at a markup where credit is tight — and then hedging this arbitrage, and jumping on the bandwagon to speculate on which way currencies will go.

Markets through arbitrage would then increase the interest rates banks pay each other to borrow reserves.

In effect, regardless of what people think the price of the commodity will be in the future, arbitrage trading will prevent the futures price from deviating from the spot price after taking into account the cost of credit (the interest rate) and the cost / availability of storage.

In the meantime, as we wait for the start of rate normalization, firms continue to play capital structure arbitrage, and the cost of waiting to lift off from «emergency» interest rate levels grows.

The banks are trying to win back their losses by arbitrage operations, borrowing from the Fed at a low interest rate and lending at a higher one, and gambling on options and derivatives.

For starters, the ECB's $ 489 billion in three - year loans at 1 % interest gives banks a free lunch arbitrage opportunity (the «carry trade») to buy Greek and Spanish bonds yielding a higher rate.

A short while ago the Blackstone hedge fund's co-founder, Stephen Schwarzman, characterized the attempt to tax short - term arbitrage trading gains at the same rate that wage - earners pay as analogous to Adolph Hitler's invasion of Poland in 1939.

With negative rates still in effect in Europe and the Fed's continuing on its current path of gradually raising rates, it makes perfect sense for European banks to continue to hold reserves at the Fed at a continuingly widening spread to take advantage of the risk - free arbitrage that currently exists.

The current difference between these exchange rates is 50 %, which generates opportunities for arbitrage and speculation.

The vast rate differentials is fertile ground for currency arbitrage and speculation.

30 year mortgages can make sense if you keep them the entire length, get a low interest rate, and realize you can make more elsewhere with arbitrage.

If you are paying a loan rate of 4.5 % or even 5 %, you are still earning positive arbitrage of nearly 2 % in the worst year.

At Camp FI, about 50 or 60 people gather for three days of what Mr. Money Mustache calls «crazy rich people talk» — real estate investing, travel hacking, gift card arbitrage, 70 % saving rates, and the rewards of frugality and thrift.

I personally haven't done this arbitrage thing but I can see how it would work in a high - interest rate environment.

The practice, also known as arbitrage, is used to play the interest rate spread to ultimately make money.

Card arbitrage works when you apply for several such cards that advertise a 0 % APR or a low APR, and you take out balance checks from them to deposit into your interest bearing savings accounts which sport higher rates.

McKnight does mention variable rate loan provisions and the possibility of gaining positive arbitrage with policies that have this feature.

A great way to increase your savings rate is with location arbitrage.

When designing a whole life policy the cost of loans vs ongoing dividend rates is a key focus because the goal is often to keep a desirable «arbitrage» on your loan rate and the asset you use your loan to purchase.

Much of the time the tax arbitrage is not much of a benefit, as clawbacks of various programs can make your effective tax rate in retirement higher than raw income might suggest.

The benefit from tax - arbitrage just between the bottom rate of 20 % and a middling ~ 30 % is a one - time gain of ~ 10 %, which is going to far exceed one or two years of tax on investment growth (assuming you don't actually need the money to pay for your expenses while out of the workforce).

If contributing to an RRSP is not especially valuable (because the tax drag on non-registered is low and / or the final tax arbitrage is low with higher rates to withdraw), then contributing early isn't helpful.

It's essentially an arbitrage opportunity where you've borrowed at a lower rate and can lend at a higher rate.

For example, with a current cap rate of 11.5 %, potential arbitrage could be as high as 5.5 % if the index credit reaches the maximum cap rate.

This article expands on the complex structure of derivatives by explaining how an investor can assess interest rate parity and implement covered interest arbitrage by using a currency forward...

It is a flexible, deep, and liquid market, permitting traders to construct interest rate positions for specific time periods in the future, and to create arbitrage positions against other credit instruments.

(Morningstar «ETF Specialist»: Jul 31, 2013) Morningstar's «ETF Specialist» column discusses heightened merger and acquisition activity, and features ProShares Merger Arbitrage ETF (MRGR) among merger - arbitrage ETFs that should benefit from this activity and from the prospect of rising intereArbitrage ETF (MRGR) among merger - arbitrage ETFs that should benefit from this activity and from the prospect of rising interearbitrage ETFs that should benefit from this activity and from the prospect of rising interest rates.

This is because, if there are stocks available to short, and the futures price is in backwardation, a trader can make an arbitrage profit by shorting the commodity in the spot market, buying the futures contract and investing the proceeds at the risk free rate.

But if your STP horizon is > 12 months, arbitrage funds can be a bit tax efficient ones, as they are treated as Equity fund for taxation purposes and also the STCG tax rate is 15 % (assuming tax assess is in 20/30 % tax slab).

Arbitrage Funds can be a better choice if you are in the tax slabs of 20 to 30 %, when markets are very volatile and when the interest rates are stable or increasing.