Liquidity: Liquidity risk for cash alternatives takes two basic forms: lock-ups and liquidity crises.
Liquidity risk goes hand in hand with the whole move of OTC trades into exchanges.
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The practices of even the best banks do not cope well with liquidity risk.
You may say hooray for banks that are happy to insure you against credit and liquidity risk.
Far better, reckons Mr Scholes, if firms were to buy protection against liquidity risk in the market.
To manage liquidity risk, our funding is deliberately diversified, both geographically and between four funding streams retail, wholesale, securitisation and covered bonds.
By and large they certainly succeeded in bettering their positions but at the expense of adding liquidity risk to their supply chain.
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"The rapid expansion of trust assets in 2012 has possibly increased the industry's credit risk and liquidity risk, " National Trust said in its earnings report.
Wholesale trading in Europe, which used to be mostly based on currency bets, is now a game of credit and liquidity risk, expressed in interest-rate spreads.
He worried more than most about liquidity risk, the danger of cash-flows and funding drying up (which many financiers ignored at their peril in the last boom).
We are encouraging firms to improve their management of liquidity risk and to reduce over time their reliance on triparty repos for overnight financing of less-liquid forms of collateral.
The bigger the role that central banks have in offering liquidity support, the less commercial banks need to worry about their liquidity risk which is why tougher regulation of liquidity is required.
"We believe this announcement is a considerable positive given reduced liquidity risk and would expect investors to again focus on SLM's profitability and growth potential, " Lehman Brothers analyst Bruce Harting told Reuters.
They need to look at intraday liquidity risk.
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The important point is that businesses like Zopa and Funding Circle do everything that banks do, except that all the credit risk (the risk that the borrower can't repay) and all the liquidity risk (the risk that you as lender won't be able to get your cash when you need it) is with the lender - not with Zopa or Funding Circle.
It also beat its peers in derivatives exposures, trading assets, cross-border risk, liquidity and market risk.
Under the Basel III rules, banks have to restructure their balance sheets to meet new liquidity and risk-weighted asset ratios, and small-business loans can often fall under the riskier categories.
Corzine used the repo trade to finance purchases of billions of dollars of volatile European sovereign debt instead, thereby multiplying the liquidity and risk management needed to come out ahead.
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While commodity prices are being fueled in part by excess liquidity chasing risk, as developed economies follow through with loose monetary policy, the dynamics behind emerging market currency fluctuations, especially the real, are traced out by their interaction with China.
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In general, effective government oversight of individual institutions increases financial resilience and reduces moral hazard by attempting to ensure that all financial firms with access to some sort of federal safety net--including those that creditors may believe are too big to fail--maintain adequate buffers of capital and liquidity and develop comprehensive approaches to risk and liquidity management.
Bonds and loan prices are complicated by other factors, such as liquidity, currency risk and interest-rate risk.
But having optimal liquidity with little risk even with no yield is looking more and more like a bargain.
Mr Sarris cited the "lack of substantial liquidity and significant risk of deposits outflow, with possible outcome the collapse of the credit institutions" as the reasons for the restrictions.
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Some of these risks, according to Upendra Choudhary, senior vice president of credit services at Amba Research, include trading risk (some of these markets are thinly traded and have low liquidity), political risk and transparency risk (some areas have no or at least confusing accounting standards).
For stockholders, exercising the stock early, before a liquidity event, adds risk.
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We think this indicates plentiful liquidity and an inflation risk, but also too high a probability of a premature Fed pause or cut.
Globally some of the liquidity conditions that supported risk appetite, including central bank policies such as guarantees and quantitative easing, show no signs of being removed.
Finally, realize that even in the current low interest rate environment, short-term, low-yield bonds offer the advantage of liquidity and little downside risk, allowing them to potentially play an important role in your portfolio.
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