Credit Default Swaps
One of the more interesting developments in the world of credit derivatives is the credit default swap, or CDS.
credit default swap investment & finance definition
A financial trans-action in which the holder of a debt instrument pays a premium for protection from a loss in the case of default.
Credit Default Swaps (CDS) Definition
Credit default swaps (CDS) are insurance-like contracts in which the buyer of the CDS makes certain payments to the seller in exchange for the promise to receive a payoff in the event of a default.
Credit Default Swap
A bilateral over-the-counter (OTC) contract in which the seller agrees to make a payment to the buyer in the event of a specified credit event in exchange for a fixed payment or series of fixed payments; ...
Credit default swap
The credit default swap or CDS has become the cornerstone product of the credit derivatives market. This product represents over thirty percent of the credit derivatives market.
Credit Default Swap: In this type of swap the purchaser of the CDS pays a stream of payments to the seller in exchange take delivery of a payoff if an instrument of credit such as a loan or a bond is not paid (falls into default).
Credit default swap: A contract allowing for the transfer of credit risk through a derivative instrument. The party transferring credit risk is obligated to pay a fee to the transferee.
Credit default swap, (CDS): A CDS is an OTC derivative transaction. It allows the parties involved to trade the credit risk on an underlying entity.
credit default swap (CDS)
A credit default swap is akin to an insurance policy in the event of certain credit events such as bankruptcy, failure to pay and restructuring of debt.
Credit default swap (CDS)
A credit default swap (CDS) is a derivative financial product frequently likened to an insurance contract.
Credit default swaps (credit default swaps): The value of these instruments increases the likelihood of default by the debtor.
Credit default swap
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Credit default swaps (CDS)
Credit default swaps are financial instruments that permit the trading of credit risks. They are essentially tradable insurance contracts used to hedge against the default of a borrower or similar credit instruments.
As the Dow was making new highs, there were a few analysts that were saying the major banks were in serious trouble because the risk associated with the credit default swaps was too high.
So many companies who bought bonds of these distressed companies entered into credit default swaps, which promised to pay the bondholders the principal should the bond issuers default.
The purest form is the "Credit Default Swap" market which is essentially a traded market in credit insurance.
On September 16, 2008, failures of large financial institutions in the United States, due primarily to exposure of securities of packaged subprime loans and credit default swaps issued to insure these loans and their issuers, ...
Credit default swaps were triggered and will be settled in an orderly fashion. This avoids many of the predicted consequences, at least for a time. From the perspective of those trying to deal with major problems, additional time is good. ...
By the way, Shoganai, CDS = Credit Default Swaps - they are basically insurance on the other party defaulting on the bond you bought. CDO = Collateralized Debt Obligation - a collection of different debt instruments.
Tracers contain a number of coporate bonds and credit default swaps which are selected for liquidity and diversity. Lehman Brothers launched a similar product, Targeted Return Index Securities (Trains) in January 2002.
"As with other securities that trade privately and by appointment, assigning values to credit default swaps is highly subjective.
The act of 2001, incorporated by reference into the House appropriations act of 2001, (in the late of night?) exempted credit default swaps from any regulation by SEC of CFTC. How and why did this happen?
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Credit Default Swaps and Why They Aren't Evil
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Credit Default Swap A Swap in which A pays B the periodic fee, and B pays A the floating payment that depends on whether a predefined credit even has occurred, or not. The fee might be quarterly, semiannual, or annual.
credit default swap A specific kind of counterparty agreement which allows the transfer of third... credit derivative A contract between two parties that allows for the use of a derivative instrument...
 See also: Default, Market, Investment, Stock, Risk
  
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