Category: Liquidity & Risk Management

Central clearing involves a middleman called a central counterparty (CCP) who steps between buyers and sellers to cut down on risk. Through a process called novation, the CCP replaces an original contract with two new ones: one between the buyer and the CCP, and another between the seller and the CCP.

Asset liquidity risk gauges how effortlessly assets can be turned into cash without tanking their market value. It’s crucial because it impacts investment decisions by determining how quickly you can cash out without taking a loss. You need to consider how this risk affects your ability to cover short-term needs, manage portfolios, and handle unexpected […]

Assessing long-term trends in real estate creditworthiness relies heavily on understanding economic indicators like interest rates, inflation, and job markets. Strong economies boost creditworthiness due to increased demand and rising property values, while weak economies do the opposite. If you’ve ever noticed property prices dip during a recession, you’ve seen this in action.