Foreign Exchange Primer

SHANI SHAMAH joined Jared James Associates as a Director mid 2006 to focus on treasury products including foreign exchange, currency options, commodities and the spectrum of short-term money markets instruments. The coverage extends globally across all revenue and non-revenue generating areas with specialization in trading, sales, structuring, research/strategy and eCommerce. With over 26 years experience in the City with various top and second tier international financial institutions, mostly in foreign exchange and currency options, she is also a specialist in the business development of eCommerce offerings (both institutional and retail) and a generalist in various other financial products with a formidable appreciation and market awareness of the risk management and compliance functions.

• Disclaimer ix 1 Introduction 1PART I MARKET OVERVIEW 72 A Brief History of the Market 93 MarketOverview 254 Major Participants 335 Roles Played 436 Purposes 45PART II FOREIGN EXCHANGE PRODUCTS 497 Spot Foreign Exchange 518 Forward Contracts 599 Short- and Long-Dated Contracts 6910 Broken-Dated Contracts 73Glossary of Terms for Chapters 7 to 10 7711 Non-Deliverable Forwards 8112 Foreign Exchange Swaps 9113 Currency Swaps 9514 Foreign Exchange Options 9915 Picturing Profit and Loss of Options 117Glossary of Terms for Chapters 14 and 15 13316 Foreign Exchange Futures 13717 Exchange for Physical 145PART III ESSENTIAL KNOWLEDGE 14918 Foreign Exchange Dealing Rooms 15119 Managing the Relationship with an Institution 15520 Foreign Exchange Dealings 15921 Foreign Exchange Market Orders 165Glossary of Terms for Chapter 21 16922 Electronic Foreign Exchange Trading 17123 Margin Trading 179PART IV FUNDAMENTALS AND TECHNICAL ANALYSIS 18324 Fundamental versus Technical Approaches 18525 Fundamental Analysis 19126 Key Factors Impacting Currencies 19727 Technical Analysis 207Glossary of Terms for Chapters 24 to 27 22128 Market Psychology 22329 Final Remarks 231Index 235