Early 2000, American was in an economic recession from Information Technology Bubble Decay, 9.11, Iraq war.
So America enforced Low interest rates to stabilize the economy.
After then, Housing Finance Interest was decreased and Real estate Price was increased.
II. What Are Credit Derivatives?
Derivatives are defined as the exchange or contract which has economic values deriving from the reference assets or index. According to their types, there are overall forward, future, option, and swap. Derivatives are the financial derivatives, which are enabled to trade in the market while consisting of separating the credit risk only to the holder of basic p
Stock
- 시장에서 거래되는 대부분의 증권은 주식과 채권.
- 경영참가권과 이익 배분권을 의미하는 증서.
- 기업의 입장에서는 부채를 제외한 기업가치를 배분하는 유한책임증서.
Concepts of Derivatives
Derivatives?
- 기초자산으로부터 파생되어 나온 상품이라는 의미.
Main Idea
- 기초자산의 가격에 따라 그
A derivative is a financial instrument whose value depends on other, more basic, underlying variables.
Contracts to buy or sell an asset on or before a future date at a price specified today.
Contracts that give the owner the right, but not the obligation, to buy or sell an asset.
Contracts to exchange cash on or before a specified future date based on the underlying value of currenc
derivatives do not require real capital investment
★Benefits
* Reduction in systemic counterparty risk(CCP)
- multilateral netting effect
- qualifications for participants(financial soundness)
Increase in market transparency(TR)
Effective market surveillance
+ reduction in operational risk
- requirement for back office operations
★ Needs for success
- Stand