We analyze a dual currency search model in which agents are allowed to hold multiple units of both currencies. Hence, agents hold portfolios of currency. We study equilibria in which the two currencies are identical and equilibria in which the two currencies differ according to the magnitude of...

Although, according to uncovered interest rate parity, exchange rates should move so as to prevent the carry trade being systematically profitable, there is a vast empirical literature demonstrating the opposite. High interest currencies more often tend to appreciate rather than depreciate, as...

This paper opens up the scope of risk diversification for investors active in Indian currency derivative market. It employs a DCC GARCH model to derive dynamic co variances and dynamic conditional correlations in currency-equity linkage (proxy as currency futures - Index Nifty futures) and...