on 2023/07/21 by alex1, []

In September 2006, the hedge fund Amaranth Advisors LLC lost a good USD 6 billion within one week due to bad speculation on the futures market for natural gas. The reason for the loss was a very high concentration risk as well as misjudgements of relative market price movements in different delivery dates and with […]

on 2023/07/21 by alex1, []

Investment in a company that is still at the stage of its (organizational, technical) development and therefore does not yet generate revenue from sales (sale of the good on the market). – See Seed capital. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University […]

on 2023/07/21 by alex1, []

Unless otherwise defined, the maximum amount agreed between a financial service provider and the customer that may be used for investment within a certain period of time. Corresponding contracts often also include investment objectives (investment goals), namely certain areas in which the client wishes to invest his money. – See investment advice, financial portfolio management. […]

on 2023/07/21 by alex1, []

The ratio of fixed assets to the total assets of an industry or company. If this ratio is higher than the average for the economy as a whole, the industry is said to be asset intensive (as opposed to labor intensive). Because changes in asset intensity indicate structural change in the economy, central banks monitor […]

on 2023/07/21 by alex1, []

Banks in Germany are required by law to inform customers, at the latest before accepting their purchase orders for securities, about the characteristics and risks of the form of investment and to draw their attention to other significant circumstances, e.g., the possibility of limiting orders or minimum purchase requirements. The German Federal Financial Supervisory Authority […]

on 2023/07/21 by alex1, []

Fixed-interest bearing security for which creditors must subordinate claims to those of non-subordinated claims in the event of the issuer’s liquidation or insolvency. In the event of bankruptcy, there is therefore a high probability that the bond will not be serviced. – Such bonds play a role in the eligibility for own funds of the […]

on 2023/07/21 by alex1, []

A bond (mostly issued by public-sector entities) with a debtor’s right to call the bond. This allows the issuer to redeem the issue early after a lock-up period on any interest date or to fix the interest rate again. The interest rate is usually determined on the basis of a reference interest rate. Recently, this […]

on 2023/07/21 by alex1, []

The ratio showing the portion of total capitalization of a firm represented by bonds. When making comparisons, the company’s sector of activity must be taken into account and compared with the sector average. – See Financing, Interest burden ratio. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes […]

on 2023/07/21 by alex1, []

Assessment of bank balance sheets carried out by the ECB as European banking supervisor on a uniform basis. This involves examining the condition of bank assets. In particular, it clarifies the extent to which the valuation of assets and collateral is appropriate and whether the related provisions are adequate. The AQR is regularly preceded by […]

on 2023/07/21 by alex1, []

The frequency and extent of monetary policy actions taken by a central bank within a given period. – See code words, forward guidance, guidance, verbal, open-mouth policy, fuzziness, constructive. – Cf. ECB Monthly Bulletin of November 2006, pp. 73 et seq. (detailed presentation with overviews, unfortunately linguistically unattractive in parts), ECB Monthly Bulletin of February […]