Credit spread and Credit support: Difference between pages

Revision as of 10:57, 4 April 2021

1. Credit risk - derivative instruments.

In the context of derivative financial instruments, credit support is reducing counterparty credit risk.

Usually by requiring collateral - also known as margin - to be posted by the counterparties.

2. Credit risk management.

Any form of credit risk reduction.

Also known as credit enhancement.

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+. ''Credit risk - derivative instruments''.
-The difference in yield between a given security and a comparable benchmark government security.
+In the context of derivative financial instruments, credit support is reducing counterparty credit risk.
-It gives an indication of the issuer’s credit quality.
+Usually by requiring collateral - also known as margin - to be posted by the counterparties.
-.
+. ''Credit risk management''.
-The difference in value of two securities with comparable maturity and yield but different credit jurisdiction.
+Any form of credit risk reduction.
+Also known as ''credit enhancement''.
-.
-The extra yield on a debt security over the equivalent theoretical 'risk-free' security.  In other words the proportion of the total return that the issuer must pay due to credit risk.
+== See also ==
+* [[Collateral]]
+* [[Credit]]
+* [[Credit risk]]
+* [[Credit support annex]]
+* [[Derivative instrument]]
+* [[Derivatives documentation]]
+* [[Encumbrance]]
+* [[ISDA Master Agreement]]
+* [[Margin]]
+* [[Security]]
+* [[Tranche]]
+[[Category:Accounting,_tax_and_regulation]]
-== See also ==
+[[Category:The_business_context]]
-* [[G+]]
+[[Category:Corporate_finance]]
-* [[Risk free rate of return]]
+[[Category:Investment]]
-* [[Yield]]
+[[Category:Long_term_funding]]
+[[Category:Manage_risks]]
+[[Category:Risk_frameworks]]
+[[Category:Financial_products_and_markets]]
+[[Category:Trade_finance]]