treasury bonds quiz

Commercial paper

- is a short-term unsecured security that companies use as a source of short-term and bridge financing. Investor are exposed to credit risk, although defaults are rare. Many issuers roll over their on a regular basis.

Cash management

- is a sub function treasury management. It is the process of overseeing daily cash flow access to working capital.

Repurchase Agreement

is similar to a collateralized loan. It involves the sale of a security (the collateral) with a simultaneous agreement by the seller (the borrower) to buy back the same security from the purchaser (the lender) at an agreed-on price in the future.

Government Bond

is a debt security issued by a government to support spending and obligations. pay bondholders periodic interest payments called coupon payments. issued and backed by national governments are often considered low-risk investments.

Asset Backed Securities

are financing vehicles collateralized by contracts on future cash flows, often secured by familiar assets such as automobile loans or residential mortgages, and sometimes backed by other contracts like credit card receivables or music royalties.

Financial Derivatives

are financial instruments that are linked to a specific financial instrument or indicator or commodity, and through which specific financial risks can be traded in financial markets in their own right.

Medium Term Notes

are securities that are offered continuously to investors by an agent of the issuer. They can have short-term or long term maturities.

Bank run

- often associated with the Great Depression. In the wake of the 1929 stock market crash, American depositors panicked and began withdrawing their deposits.

Ex ante and ex post

- Latin terminologies used in predicting the returns of a security. ex-ante is the prediction of a particular event in the future, such as the potential returns of a company. Ex-ante predictions are often inaccurate since it is impossible to account for variables, which are affected by market forces of supply and demand. ex-post means "after the event," while ex ante means "before the event." Ex-post is backward-looking, and it looks at results after they have already occurred. For investment companies, analysts can use historical returns to forecast the probability of making a profit or loss on an investment Nobel Laureate Harry Markowitz (1952, 1959) provided basic concepts on portfolio selection process in the field of asset pricing,

Treasury Management

is the act of managing a company's daily cash flows and large scale decision when it comes to finances.