Credit risk becomes much more dangerous when multiple problems hit at once. This danger has a special name: correlated credit risk. It happens when a company or person who owes money starts having trouble paying exactly when the things they offered as backup security also lose value. Consider mortgage loans during tough economic times. People…
A market correction happens when stock prices or other investment values drop from their recent high points, but not as severely as during a complete bear market crash. These price drops typically range between 10% and 20% from the previous peak. Corrections temporarily pause the market’s upward movement, letting prices adjust to more reasonable levels….
Corporate valuation determines how much a company is worth by looking at how much money it might make in the years ahead. Companies make money through different ways – they pay dividends to shareholders, earn profits from their business, and generate cash from their operations. Investors and financial analysts use various methods to figure out…
Corporate finance deals with how companies handle their money and make significant business decisions. It includes everything from buying other companies to raising money for new projects. Companies use corporate finance to grow, become more efficient, and make more money for their owners. What Companies Do with Their Money Buying and Selling Companies Companies often…
The corporate control market represents the space where companies change hands through various deals and transactions. This marketplace exists because companies, like other assets, can be bought and sold. Companies trade ownership for many reasons – they might want to grow bigger, save money, or adapt to changes in their industry. Significant Types of Control…
A corporate charter serves as the birth certificate of a company. This official document comes from the government and tells everyone what a corporation can and cannot do in its business activities. Many people call it the “articles of incorporation” or “certificate of incorporation” depending on where they live. The document works like a rule…
A corporate action is something a company does that changes things for people who own shares in the company. These are the people called shareholders. Corporate actions can make the price of a company’s shares go up or down. They can also change how many shares a shareholder owns or what kind of shares they…
Cornering is when someone tries to buy a whole lot of something, like a stock or a product, to control the price. It’s usually not a good thing. Most of the time, it doesn’t work, but it can mess things up if it does, especially if there isn’t a lot of that thing to begin…
Core inflation measures how prices change over time, but with a twist – it doesn’t include prices that jump around too much. Regular inflation looks at everything people buy, from groceries to gas. Core inflation takes out food and energy prices because these prices often go up and down quickly for reasons that don’t tell…
The cooling-off period is part of bringing new stocks and bonds to market in the United States. It happens when a company makes the final version of their official document about the stocks they want to sell, and when regular people can buy those stocks. The cooling-off period usually lasts 20 days. Why Have a…
