A credit default swap (CDS) is a contract that protects lenders from borrower default. Learn how a CDS works, why they’re ...

Default risk refers to the possibility that a company may fail to meet its financial obligations, such as paying dividends or repaying debt. When a company that has issued common stock defaults, the ...

Default risk in bond investing refers to the chance that a bond-issuing company or government would fail to make its debt and interest payments. As a bond investor, you can lose 100% of your ...

Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Samantha (Sam) Silberstein, CFP®, CSLP®, EA, is an experienced financial ...

The assessment of default risk is also critical in the valuation of corporate bonds and credit derivatives such as basket-default swaps. There is an important distinction between default risk under ...

Every credit portfolio produces default rates and loss given default (LGD) rates. If the two rates respond to the same conditions then risk is greater, and this affects loan pricing, portfolio ...

A rigorous approach to determining the credit risk posed by highly leveraged counterparties is not something that is easy to develop and implement. One reason for this is the scarcity of information.

Fannie Mae and Freddie Mac exhibit contrasting risk trajectories, while purchase loans dominate in a high-interest rate environment. Milliman Inc., a mortgage consulting and analytics firm, found that ...

Borrower credit quality and refinance activity push mortgage default risk slightly higher in Q1, prompting lenders to reassess overlays and risk exposure Milliman, a global consulting and actuarial ...