Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
(a) iTraxx is a group of credit derivative index managed by the International Index Company (IIC) and covering Europe and Asia and Australia. The body in the portfolio forming the indices are selected on the basis of trading volume and liquidity of the underlying CDS. For instance the iTraxx Europe index comprises of 125 investment grade names.
(b) The standard tranche for a credit index is a tranche with pre-specified lower as well as upper attachment point making it much more liquid than tranches created individually by negotiating with market makers. The subsequent are the standard attachment points representative the percentage of defaults protected by the seller of the tranche:
Equity tranche: first 0 - 3%
Mezzanine tranche: 3 - 6%
Senior tranche: 6 - 9%
Super senior tranche: 9 - 12%
(c) We can mention the subsequent few differences
• Standardized tranches of credit indices are unfunded and hence no cash payment is involved whereas tranches of CDO's issued in the market by banks or else hedge funds may be funded and requires cash payment.
• For the standardized tranches the fraction of default that it protects is previously determined on the other hand tranches of CDO's issued in the marketplace depends on the issuer (bank or hedge fund).
• The underlying portfolios are probable to be different.
• The standard tranches are additional liquid than tranches issued by banks and hedge funds.
Q. Causes of Risks 1) Wrong decision of what to invest in. 2) Wrong timing of investments. 3) Nature of instruments invested such as shares or bonds, chit funds, benefit
Aggregates Method Under the aggregates method of constructing an index number, we could have unweighted aggregates index and the weighted aggregates index. Unweighted Aggr
Now that we have an understanding about price volatility characteristics of a bond, let us turn to the duration/convexity approach, which is an alternative
Q. Show Gross Vs net working capital? The distinction between the gross working capital or the net working capital does not in any way undermine the relevance of the concepts o
Explain foreign equity ownership restrictions. Why do you think countries entail these restrictions? Several countries restrict the maximum fractional ownership of local organiza
I am looking for assignment help on the topic Structure and Organization of Treasury. It would be great if anyone help me.
Silvana Zhang of Sajjad Jafri & Geopeng Li Limited is considering purchasing a new widget making machine. She would like to know the maximum price she should pay for the new machin
The banking sector has a vital and active role in the money market. The transactions taking place in these securities are large in size, both in terms of volumes
Journal articles review reviewed
Swap-Linked Notes: Interest rate swaps are derivative products which help in transforming the cash flows of existing debt issues. These are not only useful in covering the exis
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd