This trade is highly profitable because the notes are initially sold at a discount to face value, and the market value of the notes constantly increases until they reach maturity. They are also subjected to extremely strict rules and the control mechanisms of the Federal Reserve Bank (“the FED”). The margin requirements and the use of the profits are also regulated.
Regulations restrict how banks, insurance companies and other entities can participate in the trading strategy. Only the specifically regulated and certified trading platforms can trade this way.
The private investors come into play here. Once the trading platforms have exhausted their advances, banking supervision allows private investors to participate in the program. The special instruments are increased by using this method. Thus, the economy is encouraged by the profits of the investors on one hand and the projects that are financed on the other hand.
These investments have been in demand every day for years and are conducted under strict conditions by the Federal Reserve Bank of the United States (FED) and the ICC (International Chamber of Commerce in Paris, France).