International financial encyclopaedia . 2014.
Exposure at default (EAD) — is a parameter used in the calculation of economic capital or regulatory capital under Basel II for a banking institution. This is an attribute of any exposure on bank s client.DefinitionIn general EAD can be seen as an estimation of the extent… … Wikipedia
counterparty risk — The risk that a counterparty will default (fail to perform) on its obligation under a contract. Counterparty risk is not limited to credit risk (the risk that the counterparty cannot fulfill its contractual obligations) but may also result from… … Financial and business terms
Current Exposure Method — A system used by financial institutions to measure the credit risk of losing anticipated cash flows from forwards, swaps, options and other derivatives contracts they are party to, in the event the counterparty to the contract should default. An… … Investment dictionary
Potential future exposure — quantifies the counterparty risk/credit risk by evaluating existing trades done against the possible market prices in future during the lifetime of transactions. It can be called sensitivity of risk w.r.t market prices … Wikipedia
Commodity Futures Modernization Act of 2000 — The Commodity Futures Modernization Act of 2000 (CFMA) is United States federal legislation that officially ensured the deregulation of financial products known as over the counter derivatives. It was signed into law on December 21, 2000 by… … Wikipedia
Valuation risk — combines aspects of data management, financial engineering and modelling and uncertainties related to the changing conditions of financial markets.Valuation Risks have a direct impact on internal and regulatory compliance, counterparty exposure… … Wikipedia
Collateral management — Collateral has been used for hundreds of years to provide security against the possibility of payment default by the opposing party in a trade. Collateral management began in the 1980s, with Bankers Trust and Salomon Brothers taking collateral… … Wikipedia
Credit default swap — If the reference bond performs without default, the protection buyer pays quarterly payments to the seller until maturity … Wikipedia
Credit Valuation Adjustment — Credit value adjustment (CVA) is by definition the difference between the risk free portfolio value and the true portfolio value that takes into account the possibility of a counterparty’s default. In other words, CVA is the market value of… … Wikipedia
Arbitrage — For the upcoming film, see Arbitrage (film). Not to be confused with Arbitration. In economics and finance, arbitrage (IPA: /ˈɑrbɨtrɑːʒ/) is the practice of taking advantage of a price difference between two or more markets: striking a… … Wikipedia
