2. Foreign exchange deposit transaction refers to a forward foreign exchange transaction between financial institutions and between financial institutions and investors. At the time of trading, the trader can only pay a deposit of 1% ~ 10%, and then trade at the limit of 100%.
This foreign exchange transaction originated in London in 1980s and then flowed into Hong Kong. In the early 1990s, some individuals and institutions in China participated in this kind of transaction.
Differences and connections with futures:
In addition to the margin system and futures trading, foreign exchange margin trading has some characteristics different from futures trading: first, the midfield of foreign exchange margin trading is intangible and unfixed, and it is directly carried out between customers and banks, with no intermediary institutions such as exchanges in the middle; Second, there is no maturity date for foreign exchange deposit transactions. Traders can hold positions indefinitely; Third, the foreign exchange deposit trading market is huge, with many participants; Fourth, foreign exchange deposits are rich in trading currencies, and all convertible currencies can be used as trading varieties; Fifth, the trading time of foreign exchange deposits is 24 hours; Sixth, to calculate the interest rate difference between various currencies in foreign exchange deposit transactions, financial institutions must pay or deduct deposits from deposits.
Here is an example to illustrate the flow of foreign exchange deposit transaction. A customer deposited $654.38 million as a deposit and entrusted the bank to conduct transactions. The bank stipulates that the margin ratio is 654.38+00% (that is, the maximum transaction amount of customers is 654.38 USD+00,000). On June, 65438+1October 10, the customer made a USD/DM deposit transaction in our bank. At the price of 1 USD for 1.7740 DM, Keguang sold 1 million USD and bought 1.774 million DM. The next day, the customer sold 1 .774 mark to the bank at the exchange rate of1USD 1.773 mark, and bought back $564. Then the customer realized a profit of $564 [i.e. (1000564- 100000]]. If the annual interest rate of USD is 65,438+0 percentage points higher than the interest rate of Deutsche Mark, the interest difference (the specific amount is 65,438+00,000 x 0.01/365 = USD 27.4) shall be deducted from the profit of Customer A.. As the customer actually paid only $65,438+000,000 as the deposit, the actual annual yield of this transaction is 65,438+095% (i.e. (564-27.4)/65,438+000000x365).
Margin trading is a high-risk financial leverage trading tool. From its own characteristics, risks mainly come from three aspects:
3. Forward foreign exchange transactions, also known as forward foreign exchange transactions, refer to foreign exchange transactions in which both parties do not make delivery immediately after the transaction, but agree on the trading conditions such as currency, amount, exchange rate and delivery time in advance and make actual delivery after the expiration.
The fundamental difference between forward foreign exchange transactions and spot foreign exchange transactions;
The delivery date is different. All foreign exchange transactions with a delivery date of two business days after the transaction are forward foreign exchange transactions.
4. Foreign exchange futures refers to a transaction in which both parties agree to exchange one currency into another currency in a standardized contract at a certain time in the future according to the proportion agreed now.
1972 in may, the Chicago mercantile exchange formally established the international money market branch and launched seven kinds of foreign exchange futures contracts, which opened the prelude to the innovation and development of the futures market. Since 1976, the forward foreign exchange market has developed rapidly, and the trading volume has increased dozens of times. 1978 the New York Mercantile Exchange has also increased its foreign exchange futures business. 1979 new york stock exchange also announced the establishment of a new exchange, specializing in foreign currency and financial futures. 1981February, the Chicago Mercantile Exchange opened the euro-dollar futures trading for the first time. Subsequently, Australia, Canada, the Netherlands, Singapore and other countries and regions also opened the forex futures trading market. Since then, the forward foreign exchange market has flourished. Foreign exchange futures are the earliest financial futures. It not only provides effective hedging tools for investors, financial institutions and other economic entities, but also provides new profit-making means for arbitrageurs and speculators.
From a global perspective, the main market of foreign exchange futures is the United States, among which the international money market (IMM), Central American Commodity Exchange (MCE) and Philadelphia Futures Exchange (PBOT) of Chicago Mercantile Exchange are basically concentrated. In addition, the main forex futures trading-owned: London International Financial Futures Exchange (LIFFE), Singapore International Monetary Exchange (SIMEX), Tokyo International Financial Futures Exchange (TIFFE), French International Futures Exchange (MATIF) and so on. Every exchange basically has futures contracts in which the local currency trades with other major currencies.
Differences and connections of forward transactions:
In the foreign exchange market, there is a traditional forward foreign exchange trading method, which is similar to forex futures trading in many aspects and is often mistaken for futures trading. It is necessary to make a simple distinction between them here. The so-called forward foreign exchange transaction refers to the transaction method in which both parties agree to settle a certain amount of foreign exchange at the exchange rate determined at the time of transaction at a certain date in the future. Forward foreign exchange transactions are generally made by banks and other financial institutions by telephone or fax. The number, duration and price of transactions are freely agreed, which is more flexible than foreign exchange futures. When hedging, forward trading is more targeted and can often hedge all risks. The price of forward trading does not have the openness, fairness and impartiality of futures prices. Forward trading has no intermediary between exchanges and clearing houses, and its liquidity is much lower than that of futures trading, so it faces the risk of default of its opponents.