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Currency Strategy

Description

John Maynard Keynes’ reference to the ‘animal spirits’, that elemental force which drives financial markets in herd-like fashion, was applied to the stock market. However, he might as well have been referring to the currency market, for the term sums up no other more perfectly. A market that is volatile and unpredictable, a market that epitomises such a concept as the ‘animal spirits’, surely requires a very specific discipline by which to study it.

This is precisely what Callum Henderson does in this eminently practical and readable book. He provides an analytical framework for currency analysis and forecasting, combining long-term economic valuation models with market-based valuation techniques to produce a more accurate and user-friendly analytical tool for the currency market practitioners themselves.

Written by a market practitioner for fellow professionals whose job is to turn the theory into practice and actually execute the currency market transaction, the book is split into three parts:

  • Theory and practice

  • Regimes and crises

  • The real world of the currency market practitioner.

Keywords

traditional exchange rate models risk appetite indicator hedging benchmark currency market participants other analytical disciplines account balance deterioration currency risk management policy passive currency management active currency managers carry trade strategy external balance approach currency overlay manager managing currency risk currency strategist equilibrium exchange rate models appetite indicators consistent excess returns exchange rate reaction exchange rate view hedge rate interbank dealers rate parity theory hedged benchmark corporate pricing strategy speculative community

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