OPTION ON THE BEST/WORST OF N-ASSETS AND CASH
When a buyer can be paid off according to their best or worse performing assets and cash.
Your Free Online Legal Dictionary • Featuring Black’s Law Dictionary, 2nd Ed.
When a buyer can be paid off according to their best or worse performing assets and cash.
When bankers tell analysts about new developments.
Using overfunded pension plans to start new endeavors.
When deductable increases the same percent as loss incurred. This preserves and increases risk retention.
An option that allows investors to redeem their bonds if a trigger event occurs. The sudden redemption reduces cash value and makes the stock less attractive to the buyer.
The amount of risk associated with a financial investment with uncertain value. AKA risk equivalent exposure.
A new bond floated to pay an existing bond issue. This occurs at the first call date. Proceeds are invested in low risk securites until the original bond is redeemable. This is
When a dealer or trader sell all or some of a money losing position.
When a company buys an option on its own stock. This is done through a middle man generating gain even if stock value declines. Refer to loss equity put.
This guarantees a borrower an interest rate on a loan for 30 to 90 days. This makes all financing costs known for the period of time. AKA lockin provision. Refer to drop
Discounting an instrument a second time. Each time a discount is given the credit risk goes up.
The first party involved in the contractual transfer of responsibility to another party.
When an inthemoney option is created out of a latent option by pushing the barrier above the strike price. AKA kickin option. Refer to reverse knockout option.
Economic capital set aside to cover risk related exposure and losses. It can be handled internally or with regulations. Refer to regulatory capital and risk adjusted return on capital.
The calibration of a firms financial andor operating risk and its economic capital to determine its ability to withstand unexpected losses. Refer to regulator capital and risk adjusted return on capital.
A broker that overcharges for trades against established rules or an advisor who makes a profit by beating their clients to an investment.
Using syndications, participations and subunderwritings to reduce a new loans or bonds risk exposure.
When an insurance firm suffers a loss that causes financial distress because the clients loss is so severe. Protection can be provided using reinsurance mechanisms and diversification. Refer to clash loss.
The redraft of existing, disparate insurance contracts into the new master policy to combine risks and losses under a concise policy. Refer to attachment method.
A company added to prevent bankruptcy by arranging securitization for the sponsor. This company must become a charitable trust that is owned by a third party. The company and sponsor share equity.