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Currency Futures

  • Brendan Brown
  • Charles R. Geisst

Abstract

When Chicago’s International Monetary Market (IMM) launched currency futures trading in 1972, forward exchange markets had already been in existence for a century.1 Many of the ‘grey beards’ in the well-established forward market regarded the new entry with some scorn. How could this new currency market, which shared a floor with the pork belly and soyabean pits, situated in the depths of the mid-West, hope to compete with the highly liquid conventional market?

Keywords

Real Interest Rate Future Market Forward Market Clearing House Deutsche Mark 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.
    See P. Einzig, A Dynamic Theory of Forward Exchange (London: Macmillan, 1975) ch. 1.Google Scholar
  2. 3.
    See J. M. Burns, ‘Electronic Trading in Futures Markets’, Financial Analysts Journal (February 1982) for a description of this particular type of abuse.Google Scholar
  3. 6.
    A swap transaction can be shown to be equivalent to a borrow and lend operation; see B. D. Brown, ‘The Swap Market and its Relation to Currency Forward and Futures Markets’, in Futures Markets, ed. M. E. Streit (Oxford: Blackwell, 1983).Google Scholar
  4. 9.
    See B. D. Brown, Money Hard and Soft (London: Macmillan, 1978) ch. 1, for an elaboration of this distinction.CrossRefGoogle Scholar
  5. 10.
    For a treatment of currency-risk hedging, see R. Z. Aliber, Exchange Risk and Corporate International Finance (London: Macmillan, 1978).CrossRefGoogle Scholar

Copyright information

© Brendan Brown and Charles R. Geisst 1983

Authors and Affiliations

  • Brendan Brown
  • Charles R. Geisst

There are no affiliations available

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