What is Financial Risk Management Software? Financial risk management software solutions are computer-based programs that help identify, measure, and model out the risk associated with specific financial risk exposures. Investment in financial risk management software by firms is a form of risk mitigation. The software is widely used by companies in the financial services sector…
What is an ESG Fund? An ESG Fund is a broad term used to describe any investment vehicle for which the fund manager(s) used environmental, social, and governance (ESG) criteria to inform its composition and asset allocation strategy. ESG fund managers use a variety of investment strategies – including negative screening, thematic investing, or ESG…
As an online learning provider, Corporate Finance Institute was built on the idea that knowledge is power. Channeling the knowledge of finance experts into practical, curated learning paths, CFI gives learners real-world skills and an understanding of financial concepts to empower them in their careers. What continues to surprise us is just how powerful that…
What is Credit Risk? Credit risk is when a lender lends money to a borrower but may not be paid back. Loans are extended to borrowers based on the business or the individual’s ability to service future payment obligations (of principal and interest). Lenders go to great lengths to understand a borrower’s financial health and…
What are the Main Types of Cryptocurrencies? Presently, there are thousands of cryptocurrencies out there, with many more being started daily. While they all rely on the same premise of a consensus-based, decentralized, and immutable ledger in order to transfer value digitally between trustless parties, there are subtle and not-so-subtle differences between them. This article…
Is Cryptocurrency a Good Investment? With trillions of dollars invested and all the hype in cryptocurrencies and new crypto projects being rolled out daily, the question that many investors are asking themselves is whether cryptocurrencies are a good investment. Despite investors losing most, if not all, of their investment in scams like the Squid Game…
What is LTV (Loan-to-Value)? LTV represents the proportion of an asset’s value that a lender is willing to provide debt financing against. It’s usually expressed as a percentage. LTVs tend to be higher for assets that are considered more “desirable” as collateral. The desirability of an asset as collateral is generally measured by how stable…
What is Venture Capital? Venture capital is a type of private equity investing that involves investment in earlier-stage businesses that require capital. In return, the investor will receive an equity stake in the business in the form of shares. Companies that raise venture capital do so for a variety of reasons, including to scale the…
What is LGD (Loss Given Default)? LGD (Loss Given Default) is a lender’s (creditor) ‘s projected loss in the event that a borrower triggers an event of default. LGD is a measure used by financial institutions and other private, non-bank lenders to help calculate the projected profitability of a loan (often referred to as a credit…
