Digital currency - Wikipedia Currency linked deposit wiki

A currency board is a monetary authority which is required to maintain a fixed exchange rate with a foreign currency. Currency linked deposit wiki policy objective requires the conventional objectives of a currency linked deposit wiki bank to be subordinated to the exchange rate target. The currency board in question will no longer issue fiat money but instead will only casino de one unit of local currency for each unit or decided amount of foreign currency it currency linked deposit wiki in its vault often a hard currency such as the U.

The surplus on the balance of payments of that country is reflected by higher deposits local banks hold at the central bank as well as initially higher deposits of the net exporting currency linked deposit wiki at their local banks.

The growth of the domestic money supply can now be coupled to the additional deposits of the banks at the central bank that equals additional hard foreign exchange reserves in the hands of the central bank.

The virtue of this system is that questions of currency stability no longer apply. The drawbacks are that the country no longer has the ability to set monetary policy according to other here considerations, and that the fixed exchange rate will, to a large extent, also fix a country's terms of trade, irrespective of economic differences between it and its trading partners.

Typically, currency boards have advantages for small, open economies which would find independent monetary policy difficult to sustain. They can also form a credible commitment to low inflation. More than 70 countries have had currency boards. Currency boards were most widespread in the early and mid 20th century. Estonia had a currency board fixed to the Deutsche Mark from to when it switched to fixing to the Euro at par.

The peg to the Euro was upheld until January just click for source Estonia's adoption of the Euro.

This policy read article seen as a mainstay of that country's subsequent economic success [ citation needed ] see Economy of Estonia for a detailed description of the Estonian currency board.

Argentina abandoned its currency board in January after a severe recession. To some, this emphasised the fact that currency boards are not irrevocable, and hence may be abandoned in the face of speculation by foreign exchange traders. They argue that Argentina's monetary system was an inconsistent mixture of currency board and central banking elements.

The economy fell deeper into depression before a recovery began later in the year. Helena continue to operate currency boards, backing their locally printed currency notes with pound sterling reserves.

A gold standard is a special case top 10 online casinos eu a currency board where the value of the national currency is linked to the value of gold instead of a foreign currency. From Wikipedia, the free encyclopedia.

Bank reserves requirements Discount window Gold reserves Interest rate Monetary authority central bank currency board Monetary base Monetary currency union Money supply. Non-tax revenue Tax revenue Discretionary spending Mandatory spending. Balanced budget Economic growth Price stability. Fiscal adjustment Monetary reform.

External adopters of the US dollar. Currencies pegged to the US dollar. External adopters of the euro. Currencies pegged to the euro. US dollar users, including the United States. Euro users, including the Eurozone. Australian dollar users, including Australia. Indian rupee users and pegs, including India. New Zealand dollar users, including New Zealand.

Intertops casino sterling users and pegs, including the United Kingdom.

Russian ruble users, including Russia and other territories. Special drawing rights or other currency basket pegs. Three cases of a country using or pegging the currency of a neighbor.

Economists on Argentina's Depression " August Retrieved from " https: Foreign exchange market Currency Monetary policy Government institutions. All articles with unsourced statements Articles with unsourced statements from January Views Read Edit View history. This page was last edited on 9 Februarysites gambling online popular By using this site, you agree to the Terms of Use and Privacy Policy.

Monetary policy Bank reserves requirements Discount window Gold reserves Interest rate Monetary authority central bank currency board Monetary base Monetary currency union Money supply. Optimum Balanced budget Economic growth Price stability. Reform Fiscal adjustment Monetary reform.

Currency band Exchange rate Exchange-rate regime Exchange-rate flexibility Dollarization Fixed exchange rate Floating exchange rate Linked exchange rate Managed float regime Dual exchange currency linked deposit wiki. Foreign exchange currency linked deposit wiki Futures exchange Retail foreign exchange trading.

Currency Currency future Currency forward Non-deliverable forward Foreign exchange swap Currency swap Foreign exchange option. Bureau de change Hard currency Currency pair Currency linked deposit wiki exchange fraud Currency intervention.


Digital currency (digital money or electronic money or electronic currency) is distinct from physical (such as banknotes and coins). It exhibits properties similar to.

In Hong Kong, currency-linked investments are a popular kind of investment product offered to retail investors. They are usually sold by banks as "currency-linked deposits". However, you should bear in mind that a currency-linked investment product is not equivalent to a time deposit and is not covered by the Deposit Currency linked deposit wiki Scheme in Hong Kong.

Also, depending on the terms of the individual product, it currency linked deposit wiki be not principal-protected. A currency-linked investment product is a structured investment product that consists of a time deposit in the deposit currency with currency option derivatives.

In general, if deposit bonus 2017 purchase a non-principal-protected currency-linked investment product, you will be selling a put option on an alternative currency ie the linked currency of your choice to the offeror eg a bank.

Investing in a currency-linked investment product is therefore not the same as buying the linked currency directly. The proceeds that you will receive at the end of the tenor will depend on the exchange rate of the base currency ie the deposit currency and the linked currency. Your return on a currency-linked investment product depends on whether the currency linked deposit wiki exchange rate is at or above currency linked deposit wiki predetermined conversion rate upon maturity.

Below is an example of a currency-linked deposit with click at this page base currency in Hong Kong dollar and the linked currency in Australian dollar:. In general, there is a minimum investment amount and a selection of available currencies offered by the offeror. For example, at the time you set up a currency-linked deposit with the bank, you choose a currency linked deposit wiki currency, a linked currency and the deposit tenor.

Based on your forecast of the foreign exchange movement of the linked currency that you choose, you will agree with the bank a conversion rate of the linked currency against the base currency ie the predetermined conversion rate.

Upon maturity of the product, you will be paid the maturity proceeds which comprise the principal and interest in either the base or linked currency, depending on the prevailing market exchange rate compared with the predetermined conversion rate currency linked deposit wiki the currency linked deposit wiki currency.

If the linked currency moves currency linked deposit wiki the direction you expect, you will receive the maturity proceeds in the base currency. On the contrary, if it moves in the opposite direction, your maturity proceeds received currency linked deposit wiki be converted to the linked currency at the predetermined conversion rate accordingly.

Given that a currency-linked investment product is not equivalent to a time deposit and is often not principal protected, you should be aware that you could lose all your money in the worst scenario. Some common key risks specific to this investment product include:. Currency-linked investment is click the following article unlisted structured product embedded with derivatives.

It is not equivalent to time deposit. Currency-linked investment is embedded with currency linked deposit wiki currency option which involves risks, especially when selling an option. Although the premium received from selling currency linked deposit wiki option is fixed, you may suffer a loss well in excess of such premium, and your loss could be substantial in extreme cases.

If the offeror of the currency-linked investment product becomes insolvent or defaults on its obligations, you will not receive any maturity payout on the maturity date. You may only claim as an unsecured creditor of the bank. If the currency-linked investment product is not principal-protected, in the worst case, you could lose your entire investment if value of the linked currency payable by the offeror to you becomes valueless on the maturity date.

Even if the currency-linked investment product is principal-protected, the principal protection feature is only applicable if you hold the product till maturity. You could still lose your entire investment if the offeror becomes insolvent or defaults. The maximum potential gain is capped at the pre-determined interest amount on the currency-linked investment product. The return of currency-linked investment depends on the exchange rate movement of the base currency against the linked currency.

The exchange rate of a currency is affected by a number of unpredictable factors including macroeconomic and political factors. For example, the government of a country may impose exchange control currency linked deposit wiki other monetary. Measures with little or no warning, which may impact link on the convertibility and exchange rate of a currency against other currency.

Generally you cannot early terminate or adjust the transaction terms of a currency-linked investment product. Pre-investment cooling off period PICOP is applicable to each particular deal of the currency-linked investment products if you are one of the following retail customer types:. Under the PICOP arrangement, you should be given at least 2 calendar days of which the last day should be a business day to understand the currency-linked investment, consider the appropriateness of the investment and, if necessary, consult family members and friends.

The terms of transaction will be fixed on the day when you give instruction to the bank to confirm a purchase, i. Currency-linked investment products issued by banks are not authoriszed by the Securities and Futures Commission but banks selling these products are required to comply with the requirements of the Hong Kong Monetary Authority HKMAthe banks' regulator. To enhance product disclosure to retail investors purchasing currency-linked investment products issued by banks, banks selling these products are required by the HKMA to distribute an Important Facts Statement IFS to the clients.

The product offering documents, including the IFS, provide you with detailed information about the key features and risks of the product. You should read and understand the product offering documents before deciding whether click the following article invest.

As always, you visit web page not invest in any financial products you do not know or understand.

Therefore, you should fully understand the features and risks of currency-linked investment products before deciding please click for source to invest. You are also advised to check out with the banks or seek independent professional currency linked deposit wiki if you are in any doubt about the product or whether it is suitable for you before making a commitment.

Home Currency-linked investment products Currency-linked currency linked deposit wiki products.


Dual Currency Deposit

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The main qualities of an orthodox currency board are: A currency board's foreign currency reserves must be sufficient to ensure that all holders of its notes and.
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Digital currency (digital money or electronic money or electronic currency) is distinct from physical (such as banknotes and coins). It exhibits properties similar to.
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The main qualities of an orthodox currency board are: A currency board's foreign currency reserves must be sufficient to ensure that all holders of its notes and.
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Digital currency (digital money or electronic money or electronic currency) is distinct from physical (such as banknotes and coins). It exhibits properties similar to.
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