GMS 724 Chapter Notes - Chapter 8: Profit Margin, Chicago Mercantile Exchange, Euronext

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 724
• Professor: Howard Lin

Document Summary

Foreign exchange money denominated in the currency of another nation or group of nations. Foreign exchange market where foreign exchange transactions take place. Form of cash, funds available on credit and debit cards, travelers checks, bank deposits, or other short term claims. Exchange rate price of a currency: make international price and cost comparisons. Bank for international (bis) divides market into three major categories: reporting dealers, other financial institutions, nonfinancial intuitions, money center banks- reporting dealers o. Financial institutions that actively participate in local and global foreign exchange and derivative markets. Volume of transactions money center banks engage in influence price setting and are the market markers: other financial institutions are financial institutions not classified as reporting dealers. Broker system trades are matched up for foreign exchange dealers. Single bank propriety system or multibank dealing system. Trades between a reporting dealer and either a non reporting dealer or customer without a third party being involved.