Handbook of Exchange Rates

Handbook of Exchange Rates is an essential reference for fund managers and investors as well as practitioners and researchers working in finance, banking, business, and econometrics. The book also serves as a valuable supplement for courses on economics, business, and international finance at the upper-undergraduate and graduate levels.

Introduction:

The Handbook is designed to span this extensive subject, with experts in the different areas contributing to each section. In planning the book, we drew up a list of the key subjects deserving of a chapter and against each we wrote the name of the key people in that topic. In almost every case, to our delight, those people accepted our invitation to contribute. As a result, the chapters have been written by leading specialists in their fields, often with extensive experience in academia and/or professional practice. Each chapter then benefitted from the feedback of at least one anonymous referee and at least one coeditor, and most authors kindly also acted as referees.

The initial section ‘‘Overview’’ covers structure, regimes, and general underlying behaviors. Part 2 covers models and methods, focussing on the predictability—or lack of it—of foreign exchange rates. In Part 3, we go to the practitioner side of the subject to cover hedging, active management, high frequency trading, and products. Part 4 wraps up with a look at policy and a framework for analyzing currency crises. The chapters are mainly in the form of self-contained surveys, and trace the key developments in a well-defined topic with specific reference to the relevant research frontier.

Some contributions also present new empirical findings, especially where competing paradigms are evaluated. So rapid has the evolution of this market been, that it would not be surprising if in a few years there are many new chapters to add! Alternatively, market stresses and political crises can influence foreign exchange rates to an enormous extent. It is easy to forget that our current regime of floating market determined rates is recent, and by no means the norm in a historical context. The foreign exchange market is a fascinating subject, which never stops evolving.