Pure Expectations Theory
The simplest of interest rate theories is the pure expectations theory which assumes that the term structure of an interest contract only depends on the shorter term segments for determining the pricing and interest rate ...
Rational Expectations Theory
Investment Dictionary:
Rational Expectations Theory
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Expectations Theory
A theory proposing that long-term interest rates can act as a predictor of future short-term interest rates.
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Pure expectations theory
A theory that asserts that the forward rates exclusively represent the expected future rates. Related: Biased expectations theories
Pure index fund ...
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.
Expectations theory of forward exchange rates
A theory of foreign exchange rates that states that the expected future spot foreign exchange rate t periods from now equals the current t-period forward exchange rate.
A biased expectations theory that asserts that the implied forward rates will not be a pure estimate of the market`s expectations of Future interest rates because they embody a liquidity premium.
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Preferred habitat theoryA biased expectations theory which rejects the assertion that the risk premium must rise uniformly with maturity.
Liquidity theory of the term structure A biased expectations theory that asserts that the implied forward rates will not be a pure estimate of the market's expectations of future interest rates because they embody a liquidity premium.
 See also: Market, Future, Short, Trading, Investment
  
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