Cost of carry and Sukuk: Difference between pages

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imported>Doug Williamson
(Add quote. Source: ACT blog https://www.treasurers.org/weekly-roundup-29-april-updates-treasury-matters-relating-coronavirus)
 
imported>Doug Williamson
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Cost of carry means the total net costs of holding an investment asset or market position.
''Sharia-compliant finance.''


Cost of carry includes financing costs.
A negotiable instrument representing a proportionate share of an underlying capital asset, financed by the cash raised from the issue of the sukuk.


Sometimes referred to (not strictly correctly) as an 'Islamic bond'.


For physical assets, cost of carry may include storage and insurance costs.


Cost of carry is usually calculated and stated after offsetting any income generated by the asset.
== See also ==
 
* [[Bond]]
 
* [[Securitisation]]
:<span style="color:#4B0082">'''''Cost of carry can be a price worth paying'''''</span>
* [[Securitisation special purpose vehicle]]
 
* [[Sharia-compliant finance]]
:Update on treasury matters relating to the coronavirus...
* [[Sharia-compliant fixed income capital markets instruments for cross-border transactions]]
 
* [[Special purpose vehicle]]
:One treasurer had resisted pressure from the board to draw down on their RCF by drawing down on only 20% of the facility as a test case and then subsequently repaying the loan. They felt the cost of carry was unnecessary.
* [[Transition sukuk]]
 
:Another treasurer felt the cost of carry, by drawing down on the RCF and then depositing the proceeds, was a cost-effective insurance policy.
 
:''Association of Corporate Treasurers, 28 April 2020, Naresh Aggarwal, Associate Director Policy & Technical.''




== See also ==
===Other links===
* [[Backwardation]]
[http://www.treasurers.org/node/9516 Sweet sukuk, Noel Lourdes, The Treasurer, Nov 2013]
* [[Contango]]
* [[Revolving credit facility]] (RCF)


[[Category:Cash_management]]
[[Category:The_business_context]]
[[Category:Financial_products_and_markets]]
[[Category:Corporate_finance]]
[[Category:Liquidity_management]]

Revision as of 21:16, 17 July 2021

Sharia-compliant finance.

A negotiable instrument representing a proportionate share of an underlying capital asset, financed by the cash raised from the issue of the sukuk.

Sometimes referred to (not strictly correctly) as an 'Islamic bond'.


See also


Other links

Sweet sukuk, Noel Lourdes, The Treasurer, Nov 2013

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