Reference rate and Reinvestment risk: Difference between pages

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A widely recognised and quoted interest rate - such as the Fed funds rate, the prime rate, or LIBOR - by reference to which a rate of interest is calculated.
The risk of unfavourable changes in prevailing market returns at the time when maturing funds become available for reinvestment.


For example, in the rate ‘LIBOR plus 50 basis points’, LIBOR is the reference rate.


== See also ==
* [[Zero coupon]]
* [[Zero coupon bond]]


==See also==
[[Category:Financial_risk_management]]
*[[ARRC]]
*[[LIBOR]]
*[[Loan agreement]]
*[[Zero rate provision]]

Latest revision as of 16:08, 28 February 2018

The risk of unfavourable changes in prevailing market returns at the time when maturing funds become available for reinvestment.


See also