Hot money refers to the liquid funds from investors with little tolerance for low returns or lack of results on the part of investment managers in the short run and that are withdrawn swiftly at any initial signs of trouble. Hot money money that moves across country borders in response to interest rate differences and that moves away when the interest rate differential disappears hot money funds that an investor moves from one investment vehicle to another in response to higher interest rates for example an investor may move hot money from an investment grade bond to a
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