Expectations theory of forward exchange rates

Definition:

A theory of foreign exchange rates that states that the expected future spot foreign exchange rate t periods from now equals the current t-period forward exchange rate.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Fully depreciated

An asset that has already been charged with the maximum amount of depreciation allowed by the IRS for accounting purposes.

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