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Covered Interest Rate Parity |
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Covered Interest Rate ParityThe principle that the yields from interest-bearing foreign and domestic investments should be equal when the forward currency market is used to predetermine the domestic currency payoff from a foreign investment.Covered Interest Rate Parity Similar MatchesCompound interestCompound interestThe process by which interest earned on an investment is added back to the amount invested, so increasing the amount of 'principal' on which further interest will be earned in future years.Compounding is sometimes described as the miracle of investing. The fact is that if you reinvest income in your portfolio, you will end up with a much larger amount than if you spend the income as you go along because of the effect of compounding. But to allow compounding to work its magic, you have to start young.Albert Einstein, when asked what he considered to be mankind's greatest invention, replied 'Compound interest!' Interest rateInterest rateThe rate of return on bonds, loans, or deposits. When one speaks of "the" interest rate, it is usually in a model where there is only one. Simple interestSimple interestInterest calculated as a simple percentage of the original principal amount. Compare to compound interest. Interest sensitive stockInterest sensitive stockStocks whose earnings are dependent upon and change with the interest rate, e.g., bank stocks. Applied or nominal interest rateApplied or nominal interest rateThe rate used to calculate the interest due. Further SuggestionsNominal interest rateVariable interest rate interest rate Best interests of creditors test Covered interest parity prevailing interest rate Short interest Interest only mortgages Equilibrium rate of interest mortgage interest relief at source Discount Interest Spot interest rate Wild Interest interest cover Interest tax shield And interest Forward interest rate Export financing interest reversionary interest insurable interest Open interest Consumer interest Effective annual interest rate Variable interest rate Earnings before interest, taxes, depreciation, and amortization (EBITDA) |
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