Access

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If you need an accessible version of this item please contact JSTOR User Support

Determinants of the Bid-Ask Spread on Forward Foreign Exchange Contracts under Floating Exchange Rates

W. B. Cornell
Journal of International Business Studies
Vol. 9, No. 2 (Autumn, 1978), pp. 33-41
Stable URL: http://www.jstor.org/stable/154164
Page Count: 9
  • Download ($34.00)
  • Cite this Item
If you need an accessible version of this item please contact JSTOR User Support
Determinants of the Bid-Ask Spread on Forward Foreign Exchange Contracts under Floating Exchange Rates
Preview not available

Abstract

The bid-ask spread on forward contracts determines, in part, the effectiveness of the foreign exchange market as a vehicle for hedging exchange risk. The purpose of this paper is to try to explain the variation in the spread over time and across currencies by examining the costs and risks banks face when dealing in foreign exchange. The paper also attempts to define the proper risk measure for open forward position in foreign exchange.

Page Thumbnails

  • Thumbnail: Page 
33
    33
  • Thumbnail: Page 
34
    34
  • Thumbnail: Page 
35
    35
  • Thumbnail: Page 
36
    36
  • Thumbnail: Page 
37
    37
  • Thumbnail: Page 
38
    38
  • Thumbnail: Page 
39
    39
  • Thumbnail: Page 
40
    40
  • Thumbnail: Page 
41
    41