What is the 'Uncovered Interest Rate Parity - UIP' The uncovered interest rate parity (UIP) is a parity condition stating that the difference in interest rates between two countries is equal to the expected change in exchange...
Definition
When it comes to pricing an item, the greater fool hypothesis asserts that the price is decided not by its inherent worth, but rather by the irrational beliefs and expectations of market players. In the event that a reasonable...
What is a ‘Targeted Accrual Redemption Note – TARN'
A targeted accrual redemption note (TARN) is an investment vehicle, calculated based on a variation of the LIBOR formula, which provides a guaranteed sum of coupons. Once the coupons you've received...
DefinitionA take-or-pay contract is a rule structuring negotiations between companies and their suppliers. With this kind of contract, the company either takes the product from the supplier or pays the supplier a. For any product the company takes, they...
What is 'Japan ETFs' A type of exchange-traded fund that invests the majority of its assets in Japanese equities that trade on local stock exchanges. The performance of Japan ETFs does not correlate to the performance of...
What is an ‘Unconventional Cash Flow'
A series of inward and outward cash flows over time in which there is more than one change in the cash flow direction. This contrasts with a conventional cash flow, where there is only...
Simply put: Equity = Assets – Liabilities However, since there are a number of different types of assets, this definition cannot encompass them all and will have different meanings for each. The following are some common definitions for different...
What is 'Hard Inquiry' A type of credit report check that may lower an individual's credit score. A hard inquiry occurs when an individual applies for any type of credit, such as a mortgage, credit card or...
What is a 'Bad Debt Expense' Bad debt expense represents the amount of uncollectible accounts receivable that occurs in a given period. Bad debt expense occurs as a result of a customer being unable to fulfill its...
Earnings Credit Rate (ECR) What is 'Earnings Credit Rate - ECR' A daily calculation of interest paid on idle funds that reduce bank service charges. A calculated amount is then used to pay for banking fees. Therefore,...