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Collateral is an asset/property that a borrower commits to a lender in exchange for a loan, which will be forfeited if the borrower defaults.
A loan that has collateral attached to it will generally carry a more favorable interest rate, but that is not necessarily always the case. Some examples of collateral are a house when you take out a mortgage, your car when you take out an auto loan, or the stocks in your portfolio if you take your account on margin.
Typically the terms of the loan or the margin agreement will specify when the lender has the ability to claim collateral.
The ladder strategy distributes your funds uniformly among bonds with various durations. For example, if you have...
Absolutely – this is what separates them from traditional pension plans. Many participants opt to take this lump sum
Long-term care insurance policies can be structured in any number of ways, depending on your desired coverage
The Dividend Payout Ratio represents the percentage of a company’s earnings/profits that they pay-out to shareholders
Diminishing marginal utility is the decrease in the usefulness or demand for something as more and more of it is produced
Adjusted Earnings are also known as pro forma, non-GAAP earnings, and are usually met with some cynicism
Accountants and companies have responsibilities for maintaining accurate records of financial transactions and accounts
The Federal Housing Administration (FHA) protects lending institutions from mortgage defaults
Fibonacci numbers are part of the Fibonacci sequence, in which the next number in the sequence is the sum of the previous two
Life insurance guarantees that a death benefit is paid if an insured person dies while the policy is in effect