What is covered interest parity
What is covered interest parity? What are the two assumptions of covered interest parity? How do investors use covered interest arbitrage to maximize their investment returns? 500 words
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Foreign exchange market equilibrium expects that the exchange return parity will be equal to the return currency of the other country. There has so been equalization of the assets on the foreign exchange market and the currency exchange returned. Investors are therefore not able to earn more interest rates from a country with lower interest rates…
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