The promotion of water refers to whether it is determined or declined by the analysis of the exchange rate trend when determining the long -term exchange rate .If the long -term exchange rate is more expensive than the period , it is the water ascending .Today, LTG GOLDROCK will share with you the things about promoting water ~
Under normal circumstances, the number of ascension water reported by the bank is only two or three digits.If it is a two -digit number, that is, the third and fourth positions after the decimal point.The size of the number of water, the arrangement of the two numbers is also varying according to water or paste.Under the direct price method , the decimal is in front, and the large number is behind, that is, the water lift; under the indirect price method , if the decimal is behind, the large number is the front, that is, the lift.
The performance of the conversion of parity Zhongli Paste : Converting price is related to convertible bonds face value , conversion parity is related to the market priceThe market price/conversion ratio of convertible bonds).When the stock price in the market is equal to the conversion of parity, investors are at a profit and loss balance. When the conversion is higher than the market price of the stock , it is at the water; vice versa is in the water . At this time, there is a chance of arbitrage .The calculation of lift and stickers can directly compare the stock market price and conversion parity.
In the futures market, the price of the spot is lower than the price of the futures, then the basis is negative. The price of long -term futures is higher than the price of the future futures.Futures, also known as "spot stickers ", long -term futures price beyond the part of the futures price, called the "containe" (contango);The price of futures futures and the price of the spot are higher than the price of futures, then the basis is positive. This situation is called "futures sticker", or "spot -lift water ", and the price of long -term futures is lower than that is.The part of the futures price is called "Backwardation".
We usually see more such as LME Copper's Ascension Water , CBOT Beans, and Singaporean Oil.
Historically, the trade method was continuously developing. At first, it was a spot transaction with one -handed money and one hand. Later, based on the establishment of a credit system , long -term spot transactions appeared. In 1870, cotton futures transactions began in 1870.In the United States, there are no futures markets and spot markets in our academic circles. The actual situation is: the price formed on the futures exchanges A logistics system, due to the different origin and quality, when the spot is traded, the two parties need to talk about the promotion of the futures price, that is,:
Transaction price = futures price +liter water
In other words, the futures market and the spot market are just a concept of distinguish between academic research. In actual operation, the two are a overall market. Futures pricing and current goods flow.Essence
In addition, there is also a distinction between the near -month contract in the futures price .Water .From another perspective, the same is true for the long moon in recent months.
Therefore, after understanding this relationship, we can roughly look at the water and stickers: based on A as the standard, B is relatively speaking, if its value (generally manifested as price) is higher, and otherwisewater.
