RISK SHIFTING
The transfer of risk to another party. Risk shifting has many connotations, the most common being the tendency of a company or financial institution facing financial distress to take on excessive risk. This high-risk behavior is generally undertaken with the objective of generating high rewards to equity owners – who face little additional downside risk but may garner significant extra return – and has the effect of shifting risk from shareholders to debt holders. Risk shifting also occurs when a company goes from offering a defined benefit plan to its employees, to a defined contribution plan. In this case, the risk associated with pensions has shifted from the company to its employees.
POPULAR TERMS
Senior Bank Loan
Senior Bank Loan is a debt financing obligation. Senior bank loans are issued by the financial institution, typically a bank, to an entity that may ...
Regulatory Asset
Specific costs or revenues that a utility is permitted to defer to its balance sheet, instead of reporting them on the income statement of a compan ...
Multiple Tops
Reversal chart formation that exhibits the deficit of a security to break through to new peaks on several occasions, which tells a strong sell sign ...
Iceberg Order
Huge single order that was split into several smaller lots, usually through an automated program to conceal the true order quantity.
IRS Publication 910
A document that gives information on the free resources the agency offers. Published by the Internal Revenue Services (IRS), it identifies many of ...
POPULAR ARTICLE
SEE FOREX TUTORIAL
A Guide to Your Personal Income Tax: Essentials
In the United States, the progressive tax system is one of the most important yet misunderstood concepts of tax planning. Whenever people are asked ...
Featured Investment: Annuity
Featured Investment: Annuity
Investments are what trading is all about. And knowing about the various a ...
An Introduction to Ethical Investing
Ethical investing is, simply put, investing while taking into consideration your personal beliefs or your ethics. Because it is personal, it means ...
Choosing Your Bank
Now that you’ve learned the basics of banking and the importance of it, you are now ready to put your money in a bank. But which bank should ...
Buying a Home: Everybody’s Goal
Since childhood, Selena has always dreamed of owning a large farm house surrounded with lots of animals – every kind of animal the world has ...
ECONOMIC CALENDAR
| Time | Country | Indices | Period |
|---|---|---|---|
| 02:30 | PMI Manufacturing | Jul | |
| 03:45 | Markit Final Manufacturing PMI | Jul | |
| 08:00 | Retail Sales | Jun | |
| 08:30 | CPI | Jul | |
| 09:15 | PMI Manufacturing | Jul | |
| 09:30 | Procure PMI Index | Jul | |
| 09:45 | PMI Manufacturing | Jul | |
| 09:50 | PMI Manufacturing | Jul | |
| 09:55 | PMI Manufacturing | Jul |
