Pure Expectations Theory

Business / Finance / Pure Expectations Theory: A theory that asserts that forward rates exclusively represent the expected future rates. In other words, the entire term structure reflects the market's expectations of future short-term rates. For example, an increasing slope to the term structure implies increasing short-term interest rates. Related: Biased expectations theories.

Other Words for Pure

Pure Noun Synonyms: unmixed, unadulterated, unalloyed, simon-pure, 24-carat or also 24-karat, sterling, solid, real, genuine, authentic, flawless, faultless, perfect, natural, true, simple
Pure Adjective Synonyms: theoretical, hypothetical, conjectural, speculative, abstract, conceptual, notional, philosophical, academic(al)
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Biased Expectations Theories

Business / Finance / Biased Expectations Theories: Related: Pure expectations theory. MORE

Expectations Theory Of Forward Exchange Rates

Business / Finance / Expectations Theory Of Forward Exchange Rates: Theories of the term structure of interest rates, which include the pure expectations theory; the liquidity theory of the term structure, and the preferred habitat theory. These theories hold that eac MORE

Local Expectations Theory

Business / Finance / Local Expectations Theory: A form of the pure expectations theory that suggests that the returns on bonds of different maturities will be the same over a short-term investment horizon. MORE

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