Underlying asset that protects a debt holder from the risk that a borrower will default on the debt. To protect themselves from the risk of default, debt holders may purchase credit derivatives, which transfer this risk to a third party. If the borrower defaults on the debt, the debt holder may then be entitled to receive all or part of the par value of the original debt, which is called the reference asset.
Related information about reference asset:
- Reference Asset Definition | Investopedia
In a credit derivative, the buyer purchases protection against the chance of default by the risky borrower by buying the reference asset.
- What is reference asset? definition and meaning
Definition of reference asset: Underlying asset that protects a debt holder from the risk that a borrower will default on the debt. To protect themselves from the risk ...
- Reference Asset - Traders Log
Trading and Investing Terms Explained: Reference Asset.
- Reference Asset: Definition from Answers.com
Reference Asset An underlying asset used in credit derivatives, which are then used when there is a risky debt issuer, such as a corporation or municipality.
- What Is a Reference Asset?
A reference asset is the underlying subject of a credit derivative, a financial product based on performance of that asset. Credit derivatives are used by financial ...
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Terms of Reference Asset Committee. Keywords: Reference Number: Strategic Plan: Classification: Public – Corporate Policy. First Issued/Approved: November ...
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Nov 1, 2011 ... IMPORTANT INFORMATION. This document is an Information Memorandum. (“ IM”). Please make sure you read this IM in full together with the ...
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A large class of models of the price is reference asset (numeraire) invariant, for instance the geometric Brownian motion model or jump models with symmetric ...