chapter 3
OTC FX Concepts
LEARNING OBJECTIVES
This chapter introduces readers to concepts around the system of quoting in foreign exchange markets with special reference to over-the-counter (OTC) market which refers to the market in which transactions are entered into by counterparties on bilateral basis without involvement of any settlement agencies like exchange. The contents of this chapter are organized in the following order:
1. Concept of Base Currency and Home Currency
4. Concept of Hedging in Over-the-counter Market
5. Introduction to Forex Rates Determination
6. Interest Rate Parity Theory
CONCEPT OF BASE CURRENCY AND HOME CURRENCY
In India, INR against USD ...
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