Credit Derivative financial definition of Credit Derivative. Credit Derivative finance term by the Free Online Dictionary.

Credit derivative

Financial instruments in which the payoffs depend on the credit risk of companies or government entities, other than the counterparties to the credit derivative transaction itself.

Credit Derivative

Any derivative that allows an investor to hedge its credit risk. For example, if a brokerage is concerned that a client may be unable to pay a margin call, it may transfer this risk to another investor in exchange for paying a fee. Regular derivatives, like forward contracts and options, may be used as credit derivatives, depending on the credit risk of an investor's other positions.

Credit Derivative

What Does Credit Derivative Mean?

Privately held negotiable bilateral contracts that enable their users to manage their exposure to credit risk. Credit derivatives are financial assets like forward contracts, swaps, and options for which the price is driven by the credit risk of economic agents (private investors or governments).

Investopedia explains Credit Derivative

As an example, a bank concerned that one of its customers may not be able to repay a loan can protect itself against loss from default by transferring the credit risk to another party while keeping the loan on its books.

Related Terms:
• Credit Default Swap
• Credit Rating
• Derivative
• Securitization
• Yield

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Basket credit default swap CDS Credit Default Swap Derivative Dow Jones CDX Indexes	Risk management related credit derivative products such as Credit Default Swaps, albeit good hedges for risk, are truly double edged swords, if coupled with wanton speculation and overleveraging. Risk Management for Banks and Financial Institutions by Nick Nikolis / Finance and Investment community 133-1 and FIN 45-4, Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. Disclosures about Credit Derivatives and Certain Guarantees by California CPA that will buy up bad debt and cleanse financial institutions' balance sheets of the toxic credit derivative products they have been holding. The Big Bailout: Measuring the Aftershocks by David Bogoslaw / BusinessWeek	CRD CRE Creador de mercado Creancier Creancier irreductible Crear mercado Creation Unit Creative Accounting Creative Destruction creative financing Crecimiento cero Crecimiento economico Crecimiento equilibrado Crecimiento previsto Credible signal credit Credit Analysis Credit Balance credit bid credit bureau Credit Card Credit Cliff Credit Crunch Credit Default Swap Credit Department Credit Derivative credit enhancement credit history Credit Insurance credit life insurance credit limit Credit Line Credit linked security Credit market Credit par acceptation Credit Period Credit Policy Delay Credit Quality Credit Rating Credit Rating Agencies Credit Rating Agency credit rating service credit report Credit Reporte credit reporting agency credit risk Credit Score credit scoring Credit Spread Credit Squeeze Credit Standards	Credit Counselling and Debt Management Agency Credit Counselling of Regional Niagara Credit Counselling Service of Newfoundland and Labrador Credit Counselling Services of Alberta Credit Counselling Services of Toronto Credit Counselling Society of British Columbia Credit Counselors Corporation Credit Counselors of America credit crunch credit crunch Credit Curriculum and Academic Affairs Committee Crédit d'Impôt Recherche Credit debt Credit default swap Credit default swap Credit default swap Credit default swap index Credit Default Swaps Credit Denial Credit Denial Credit Denial Credit Denial Credit Denial Credit Denials Credit Denials Credit Denials Credit Denials Credit Denials credit department Credit Departments Credit Derivative Credit Derivative Product Company Credit derivative risks Credit derivatives Credit Disability Insurance Credit Discrimination Credit Discrimination Credit Discrimination Credit Discrimination Crédit du Maroc Credit du Nord Crédit du Nord Crédit du Nord Credit Education Bureau Credit enhancement Credit Enhancement Program Credit Enhancement Provider Credit Enhancement Securities Credit Enhancing Interest Only Strip credit entry Credit Equivalent Bypass Trust credit facilities Crédit Finance Bretagne Credit First National Association Credit fixer Credit Foncier Crédit Foncier de France Crédit Foncier de France Crédit Foncier et Communal d'Alsace et de Lorraine credit for

Mentioned in

References in periodicals archive

Financial browser

Full browser

Basket credit default swap
CDS
Credit Default Swap
Derivative
Dow Jones CDX Indexes

Risk management related credit derivative products such as Credit Default Swaps, albeit good hedges for risk, are truly double edged swords, if coupled with wanton speculation and overleveraging.

Risk Management for Banks and Financial Institutions by Nick Nikolis / Finance and Investment community

133-1 and FIN 45-4, Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No.

Disclosures about Credit Derivatives and Certain Guarantees by California CPA

that will buy up bad debt and cleanse financial institutions' balance sheets of the toxic credit derivative products they have been holding.

The Big Bailout: Measuring the Aftershocks by David Bogoslaw / BusinessWeek

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