SYNTHETIC CDO
Collateralized debt obligation investing in credit default swaps or other non-cash assets to accumulate exposure to a portfolio of fixed-income assets. Normally, these are divided into credit tranches according to the credit risk level assumed. Lower tranches make up the initial investments into these debt obligations while senior tranches need not to make an initial investment. These tranches receive regular payments based on the cash flows from these swaps. The synthetic CDO and its investors will take responsibility on the losses in case the event takes place in the fixed income portfolio.
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Target Return
Pricing model used in valuing a business based on what an investor expects from any capital invested in the firm. It is computed by adding the amou ...
Remainder Man
An individual who receives the remaining principal in a trust account after all required payments have been made, such as those to the beneficiary ...
Average Collected Balance
The total average of the collected funds in a bank account in a month. The balance is calculated by adding the collected balance and dividing it by ...
Bankable Funds
Forms of payment that are accepted at financial institutions. Retailers and other organizations that directly accept payments from customers typica ...
Prudent-Person Rule
A legal maxim that restricts the discretion in a client's account to investments that a prudent person seeking reasonable income and preservati ...
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