Liquidator Individual designated by unsecured creditors in the UK to supervise the sale of any insolvent company’s assets and to repay debts owned by it … [Read more...]
Liquidity
Filed Under: l by
Liquidity A high degree of trading in a market shows that it is liquid. Selling and buying occurs with least price disturbance. Also refers to a market where it is relatively easy to buy and sell. … [Read more...]
Liquidity Diversification
Filed Under: l by
Liquidity Diversification Investment strategy whereby a number of maturities are opted for rather than long bonds that expose the investor to price risk. … [Read more...]
Liquidity Path
Filed Under: l by
Liquidity Path The strategy followed by a business to provide liquidity for the owners. Most common strategies or methods are mergers and acquisitions to a bigger company, IPOs to the public. … [Read more...]
Liquidity Premium
Filed Under: l by
Liquidity Premium Denotes the difference between forward rate and expected short-term interest rate in the future. … [Read more...]
Liquidity Ratios
Filed Under: l by
Liquidity Ratios A measure (in the form of a ratio) of a firm's ability to fulfill its financial short-term obligations without delay. … [Read more...]
Liquidity Risk
Filed Under: l by
Liquidity Risk A risk arising during the sale or liquidation of any asset. Also represented as the difference between the likely price of an asset, less commissions and its true value. … [Read more...]
Liquidity Theory of the Term Structure
Filed Under: l by
Liquidity Theory of the Term Structure Theory of biased expectations stating that implied forward rates will be an objective estimate of the expectations in the market, of future interest rates. This is because a liquidity premium is embodied within. … [Read more...]
Liquidity Squeeze
Filed Under: l by
Liquidity Squeeze Hesitation among financial institutions to lend funds from reserves owing to concern regarding short-term availability of money. This causes the interbank market rate to rise, increasing the cost of interbank borrowing. … [Read more...]
Load Fund
Filed Under: l by
Load Fund Mutual fund that charges a sales load or fee when shares are sold. Usually, a 4% to 8% fee may be added to the price based on the net amount indicated. "No-load" funds may also have distribution fees added to the price. These fees (0.25%) are permitted by article 12b-1 of … [Read more...]
Listed Stocks
Filed Under: l by
Listed Stocks Those stocks that are listed and traded on an exchange. … [Read more...]
Load-to-Load
Filed Under: l by
Load-to-Load Formal understanding allowing a customer to pay for previous delivery at the time of receipt of the current one. … [Read more...]
Loan Servicing
Filed Under: l by
Loan Servicing Administration of the loan from disbursal by lender to full repayment by borrower. Includes sending statements pertaining to monthly payments, collecting such payments, maintaining and updating records of payments and balances, collecting and making tax and … [Read more...]
Loan Syndication
Filed Under: l by
Loan Syndication See syndicate. A loan sharing arrangement by a group of banks. … [Read more...]
Loan Value
Filed Under: l by
Loan Value Total amount of money that can be borrowed by policyholder against his whole life insurance policy. The policy papers specify the interest rate payable. … [Read more...]
Local Expectations Theory
Filed Under: l by
Local Expectations Theory Variant of pure expectations theory. States that bonds having different maturities will yield the same returns when the investment horizon considered is short term. … [Read more...]
Lockbox
Filed Under: l by
Lockbox Service offered by banks to businesses. Involves collection and processing activities where payments are collected from dedicated postal boxes where customers of the firm are directed to send payment to. The bank may need to make several collections in a day, process the … [Read more...]
Locked-In Interest Rate
Filed Under: l by
Locked-In Interest Rate A loan where lender and borrower agree on a fixed rate for a given period. The lender agrees to this rate as a legally binding commitment. There may be certain exceptions which, if not met, will let the lender modify the rate upwards. … [Read more...]
Locked Market
Filed Under: l by
Locked Market Market where the ask price equals bid price. There is no opportunity for arbitrage in such a situation. … [Read more...]
Lock-Out
Filed Under: l by
Lock-Out Term used with PAC bond CMO classes. The time period prior to date when the sinking fund comes into effect. For multifamily loans, the prepayment prohibited period of the loan. … [Read more...]
