LBO Buy-Side
Overview of LBO Buy-Side This article is specifically about LBOs on the buy-side of corporate finance. In a leveraged buyout (LBO), a private equity firm uses as much leverage as possible to acquire a business and maximize the internal rate of return (IRR) to equity investors. LBO buy-side entities include private equity firms, life insurance companies,...
Real Estate Investment Trust (REIT)
What is a Real Estate Investment Trust (REIT)? A real estate investment trust (REIT) is an investment fund or security that invests in income-generating real estate properties. The fund is operated and owned by a company of shareholders who contribute money to invest in commercial properties, such as office and apartment buildings, warehouses, hospitals, shopping...
Corporate Venturing
What is Corporate Venturing? Corporate venturing – also known as corporate venture capital – is the practice of directly investing corporate funds into external startup companies. This is usually done by large companies who wish to invest small, but innovative, startup firms. They do so through joint venture agreements and the acquisition of equity stakes....
Abnormal Return
Introduction In finance, understanding key metrics and concepts is crucial for investors navigating the market. Investors, both experienced and new, always aim to improve returns and manage risk. Abnormal returns, also known as excess returns, are a critical aspect. This article explores abnormal returns, detailing what excess returns involve, how they differ from risk-free rates,...
Senior Debt
What is Senior Debt? Senior Debt, or a Senior Note, is money owed by a company that has first claims on the company’s cash flows. It is more secure than any other debt, such as subordinated debt (also known as junior debt), because senior debt is usually collateralized by assets. It means the lender is...
