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Default
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Default1) The failure to make timely payment of interest or principal on a debt security or to otherwise comply with the provisions of a bond indenture. 2) In context of project financing, a technical default signals a project parameter is outside defined or agreed limits or a legal matter is not yet resolved.
RELATED TERMS--------------------------------------
Payment
The amount required to repay a loan, including interest and fees.
Interest
The amount of money a lender loans a borrower to pay for using the borrower's principal.
Principal
The amount of a loan, which the borrower has to pay back when the loan matures; a person who engages a broker to buy and sell for him.
Debt
Money borrowed.
Security
Piece of paper that proves ownership of stocks, bonds, and other investments.
Provisions
Money set aside in the accounts (and charged against profits' to provide against expected losses such as bad debts.
Bond
Certificate, stating that the issuer is committing himself to repay the loan, including interest and other payments, to the holder.
Indenture
Agreement between lender and borrower that details specific terms of the bond issuance. Specifies legal obligations of bond issuer and rights of bondholders.
Project
The asset constructed with or owned via a project financing, which is expected to produce cash flow at a debt-service coverage ratio sufficient to repay the project financing.
Default
1) The failure to make timely payment of interest or principal on a debt security or to otherwise comply with the provisions of a bond indenture. 2) In context of project financing, a technical default signals a project parameter is outside defined or agreed limits or a legal matter is not yet resolved.
Parameter
A model is a combination of variables, such as GDP growth, and coefficients which multiply these variables. The coefficients are often estimated from the data.
SIMILAR TERMS--------------------------------------
Default interest
A higher interest rate payable after default.
Default premium
A differential in promised yield that compensates the investor for the risk inherent in purchasing a corporate bond that entails some risk of default.
Default risk
The risk that an issuer of a bond may be unable to make timely principal and interest payments. Also referred to as credit risk (as gauged by commercial rating companies).
PREVIOUS AND NEXT TERMS--------------------------------------
Deduction
An expense that is allowable as a reduction of gross taxable income by the IRS.
Deductive reasoning
Using known facts to draw a conclusion about a specific situation.
Deep discount bond
A bond issued with a very low coupon or no coupon that sells at a price far below par value. A bond that has no coupon is called a zero-coupon bond.
Deep in the money
A call option with an exercise price substantially below the underlying stock's market price. Also put option with an exercise price substantially above the underlying stock's market price.
Deep out of the money
A call option with an exercise price substantially above the market price. Also put option with an exercise price substantially below the underlying stock's market price.
Default
Default interest
A higher interest rate payable after default.
Default premium
A differential in promised yield that compensates the investor for the risk inherent in purchasing a corporate bond that entails some risk of default.
Default risk
The risk that an issuer of a bond may be unable to make timely principal and interest payments. Also referred to as credit risk (as gauged by commercial rating companies).
Defeasance
1) The setting aside by a borrower of cash or bonds sufficient to service the borrower's debt. 2) In securities trading, where a clearing house becomes counterparty to each side of a trade, after the trade has been agreed.
Defensive securities
Low-risk stocks or bonds that will provide a predictable and safe return on an investor's money.
RELATED TERMS--------------------------------------
Payment
The amount required to repay a loan, including interest and fees.
Interest
The amount of money a lender loans a borrower to pay for using the borrower's principal.
Principal
The amount of a loan, which the borrower has to pay back when the loan matures; a person who engages a broker to buy and sell for him.
Debt
Money borrowed.
Security
Piece of paper that proves ownership of stocks, bonds, and other investments.
Provisions
Money set aside in the accounts (and charged against profits' to provide against expected losses such as bad debts.
Bond
Certificate, stating that the issuer is committing himself to repay the loan, including interest and other payments, to the holder.
Indenture
Agreement between lender and borrower that details specific terms of the bond issuance. Specifies legal obligations of bond issuer and rights of bondholders.
Project
The asset constructed with or owned via a project financing, which is expected to produce cash flow at a debt-service coverage ratio sufficient to repay the project financing.
Default
1) The failure to make timely payment of interest or principal on a debt security or to otherwise comply with the provisions of a bond indenture. 2) In context of project financing, a technical default signals a project parameter is outside defined or agreed limits or a legal matter is not yet resolved.
Parameter
A model is a combination of variables, such as GDP growth, and coefficients which multiply these variables. The coefficients are often estimated from the data.
SIMILAR TERMS--------------------------------------
Default interest
A higher interest rate payable after default.
Default premium
A differential in promised yield that compensates the investor for the risk inherent in purchasing a corporate bond that entails some risk of default.
Default risk
The risk that an issuer of a bond may be unable to make timely principal and interest payments. Also referred to as credit risk (as gauged by commercial rating companies).
PREVIOUS AND NEXT TERMS--------------------------------------
Deduction
An expense that is allowable as a reduction of gross taxable income by the IRS.
Deductive reasoning
Using known facts to draw a conclusion about a specific situation.
Deep discount bond
A bond issued with a very low coupon or no coupon that sells at a price far below par value. A bond that has no coupon is called a zero-coupon bond.
Deep in the money
A call option with an exercise price substantially below the underlying stock's market price. Also put option with an exercise price substantially above the underlying stock's market price.
Deep out of the money
A call option with an exercise price substantially above the market price. Also put option with an exercise price substantially below the underlying stock's market price.
Default
Default interest
A higher interest rate payable after default.
Default premium
A differential in promised yield that compensates the investor for the risk inherent in purchasing a corporate bond that entails some risk of default.
Default risk
The risk that an issuer of a bond may be unable to make timely principal and interest payments. Also referred to as credit risk (as gauged by commercial rating companies).
Defeasance
1) The setting aside by a borrower of cash or bonds sufficient to service the borrower's debt. 2) In securities trading, where a clearing house becomes counterparty to each side of a trade, after the trade has been agreed.
Defensive securities
Low-risk stocks or bonds that will provide a predictable and safe return on an investor's money.
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This dictionary contains 24549 terms.
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