Counterparty Risk
Counterparty risk refers to the risk of default of one party in a particular transaction. Credit ratings can be used to evaluate counterparty risk.
Counterparty Risk
(1) The risk that the other party to an agreement will default.
(2) In an options contract, the risk to the option buyer that the option writer will not buy or sell the underlying as agreed.
Counterparty risk
A counterparty is a party with which a transaction is done. If A sells something to B, then B is a counter-party from A's point of view and vice-versa.
counterparty risk
The risk that a counterparty will default (fail to perform) on its obligation under a contract.
Counterparty risk
Counterparty risk is the risk that the person or institution with whom you have entered a financial contract - who is a counterparty to the contract - will default on the obligation and fail to fulfill that side of the ...
Counterparty risk relates closely to performance risk. It arises whenever one entity depends on another to honor the terms of a contract.
See also: Counterparty Risk, Country Risk, Liquidity Risk, Political Risk, Price Risk, Reinvestment Risk, Risk, Risk Averse, Risk/Return Tradeoff, Systematic Risk, Unsystematic Risk
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PFE is a measure of counterparty risk/credit risk. It is calculated by evaluating existing trades done against the possible market prices in future during the lifetime of transactions. It can be called sensitivity of risk w.r.t market prices.
This is necessary to facilitate netting, and reduce counterparty risk exposure. The term has become popular recently, because of the growth of central counterparty clearing services in European cash equities markets.
counterparty risk Counterparty risk refers to the danger either side of an agreement will not... country risk When speaking of international investments, this refers to the added risk associated...
By the way, we must consider the counterparty risk that is implied in an IRS agreement. Spread is the remuneration for this counterparty credit risk.
Counterparty Risk
Risk that one party in an agreement defaults on its obligation to repay or return securities. Also known as default risk....(Read more)
Country-specific Risk ...
Subject to Downgrade Risk - Since holders of ETNs are subject to counterparty risk, their ETN investment could lose value if the underwriter of the note experiences a credit downgrade, even if the fundamentals of the underlying note remain strong.
The risk that a debt issuer may default on payments. Also called counterparty risk.
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However, notable differences include the lack of contract standardization, the lack of a central clearinghouse, the potential for substantial counterparty risk, but it allows contractual term customization and deliveries at times, ...
In the context of project financing, the issuance of a guarantee oradditional collateral to reinforce the creditstrength of a project financing. Also, the reduction of counterparty risk on a swap transaction through such measures as bilateral ...
I would like to put a precaution on using ETFs: When using ETFs to buy gold, you remove one very important element -- physical gold has no counterparty risk, but ETFs do.
But most OTC trades are not cleared, exposing firms - and the financial system - to counterparty risk. As of 2009, there is increasing political pressure for OTC trades to move to public exchanges and be handled by clearing houses.
 See also: Counterparty, Credit risk, Country risk, Expense, Default risk
  
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