Category: Finance

Credit Spread (Bonds)

Credit spread is also known as yield spread. Credit spread refers to the difference in yield of different securities. Such difference in yield arises due to the difference in credit quality of different instruments....

Covered Calls

A trader can create a covered call by selling the call options on a security already owned by him. For example, Trader Z owns 1,000 shares of security ABC and then proceeds to sell...

Credit Spread (Options)

Credit spread is also known as net credit spread. A credit spread occurs when two options of the same class are simultaneously bought and sold. These two options are also required to have same...

Put Option

A put or put option is a deal between two parties to exchange an underlying instrument, at a predetermined price (the strike), by a specified date (also referred to as a maturity date). While one party, the buyer of...

Group Term Life Insurance

Definition: It’s that type of insurance where the coverage is offered to a group of people. This coverage offers benefit to  the insured group even if one of the beneficiaries dies during the specified...

Credit Balance

Definition:  While maintaining a margin account, the amount of funds which are deposited in the customer’s account after a successful execution of a short sale order is called as credit balance. The credit balance...

Real Estate Investment Trust

A real estate investment trust or REIT is a financial product that is traded like a stock on the major stock exchanges and invests in real estate market directly, either through equities or mortgages....

Call Option

A call option also referred to as simply call is a financial transaction between two parties, a buyer and seller for this type of option trading. In this contract, the buyer has a right...

Auto Insurance/Vehicle Insurance

Vehicle insurance is known by various other names such as GAP insurance, auto insurance and motor insurance. Vehicle insurance is the insurance purchase for vehicles like motorcycles, cars, trucks and other such vehicles. This...

Credit Card Interest

Credit card interest is one of the most important means through which credit card issuers generate revenue. A card or an account number is issued by a bank or credit union which enables a consumer (the cardholder) to use it with various...

Prime Rate

Prime rate or prime lending rate is a term which is used in many countries for referring interest rate charged by banks to each other. The term earlier signified the rate of interest at which banks lent to...

Home Equity Line of Credit

A home equity line of credit also refereed as HELOC and pronounced HELL-ock  is a loan in which the lender is ready to provide a maximum amount of loan within a fixed period (called a term), where the collateral is the...

Home Equity

Home equity represents the market value of a homeowner’s unencumbered interest in their real property—to be precise; it is the difference between the home’s fair market value and the outstanding balance of all liens on the property. The property’s equity will rise as the debtor make...

Equity Loan

A mortgage backed loan in which the borrower receives the loan in cash is called as an equity loan. In general, the lender secures the loan against borrower’s real estate, already owned outright. For instance, if a person...