Capital at risk refers to money that might be lost when making investments or running a bank. This concept works differently for investors and banks, though both deal with the possibility of losing money. How Investors Face Capital at Risk Understanding Investor Risk When people invest their money, they need to know how much they…
Capital allowance helps UK businesses save money on taxes when they buy things they need to run their business. These tax savings apply to purchases like buildings, machines, and equipment. Think of it as the government’s way of encouraging businesses to invest in growing and improving their operations. What Counts as Capital Allowance? Buildings and…
A bank’s capital adequacy ratio (CAR) tells us how strong and stable the bank is. Think of it as a safety cushion—the more money a bank keeps as backup compared to what it lends out, the safer it is. Banks calculate this ratio by comparing two main things: the money they have in reserve and…
Capital adequacy plays a vital role in the stability and functioning of the banking sector. It ensures that banks have enough capital to support their lending and trading activities. This, in turn, protects depositors and other creditors from potential losses. Understanding capital adequacy helps recognize how banks maintain their financial health and comply with regulatory…
A capital account is a financial record that tracks changes in a country’s, company’s, or partnership’s capital. It includes various economic activities, investments, and contributions. This account is essential in understanding how money flows and how wealth builds over time. Below are the critical aspects of a capital account in different contexts. National Economic Capital…
Capital makes businesses work. Money powers companies and helps them grow. This article explains what capital means in the business world and why it matters to everyone. What is Capital? Capital means the money and resources a company uses to run its business and handle unexpected problems. Think of it as the foundation that keeps…
Insurance companies make money by taking on risk for a price. They agree to pay if something bad happens, like a car crash, fire, or lawsuit. The insurer charges a premium and hopes the bad thing won’t occur. If it does, they pay the claim using the premiums collected from many customers. This process is…
Candlestick charts are a way to show how the price of something, like a stock or currency, changes over time. They got their name because the rectangles on the chart look a bit like candles. What are candlesticks? Each candlestick shows important price information for a certain time period. This could be one day, one…
A cancellation provision clause is something that’s in a lot of different insurance policies, like for your house or your car. It’s a part of the contract between you and the insurance company. What it does is it gives you the right to tell the insurance company “hey, I don’t want this insurance policy anymore”…
A cancellable swap is a special kind of swap deal. A swap is when two groups agree to trade something, like money, with each other. They decide ahead of time exactly how they will do the trade in the future. What makes a cancellable swap different is that the two groups can decide later to…
