The paper studies the statistical properties of the evolution of the USD/HKD exchange rate during the period after the separation of strong and weak side convertibility undertakings, when the rate is confined to a specified corridor. We suggest a discrete time Markov model for the exchange rate...

The paper studies trading strategies for currency exchange market which do not employ any distribution assumptions on exchange rate evolution. It is found that there are strategies that ensure some speculative opportunities for currency exchange under condition of currency corridor or soft peg