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Interest rate parity theorem |
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Interest rate parity theoremExpression that the interest rate differential between two countries is equal to the difference between the forward foreign exchange rate and the spot rate.Interest rate parity theorem Similar MatchesEquilibrium rate of interestEquilibrium rate of interestThe interest rate that clears the market. Also called the trade-clearing interest rate. Variable Interest RateVariable Interest RateAn interest rate which fluctuates as the prevailing rate moves up or down. In mortgages there are usually maximums as to the frequency and amount of fluctuation. Also called "flexible interest rate." Matured noninterest bearing debtMatured noninterest bearing debtOutstanding savings bonds and notes that have reached final maturity and no longer earn interest. Includes all Series A-D, F, G, 1, J, and K bonds. Series E bonds (issued between May 1941 and November 1965), Series EE (issued since January 1980), Series H (issued from June 1952 through December 1979), and savings notes issued between May 1967 and October 1970 have a final maturity of 30 years. Series HH bonds (issued since January 1980) mature after 20 years. Compound interestCompound interestThe interest paid on the principal balance in a mortgage and on the accrued and unpaid interest of the loan. True interest costTrue interest costFor a security such as commercial paper that is sold on a discount basis, true interest cost is the coupon rate required to provide an identical return assuming a coupon-bearing instrument of like maturity that pays interest in arrears. Further Suggestionsinterest in possessionInterest accrual rate Interest payments Add on interest Covered interest parity Short term interest rates gross interest Real interest rate Mortgage interest deduction interest payable Market interest rate stepped interest debenture stocks bond interest yield Imputed interest Party in interest Interest rate Interest Cap Any interest date Term structure of interest rates Deferred interest bond Noninterest bearing note Cash flow after interest and taxes Covered interest arbitrage simple interest interest only mortgage |
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