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Credit Derivative
(redirected from Credit derivatives)

   Also found in: Wikipedia 0.02 sec.
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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The prices are provided directly from GFI's global credit derivatives brokerage desks and represent the actual levels at which market participants are willing to trade.
LONDON & NEW YORK -- Derivative Fitch has launched an updated version of its Risk Analytics Platform for Credit Derivatives (RAP CD).
2007 holds much promise for the global CDO and credit derivatives arena as novel methods of packaging credit and market risks and new analytical models emerge.
 
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