English

Part of operational risk. Conduct risks can be divided into error risks, negligence risks and criminal risks. – An error occurs when the bank – in compliance with internal guidelines and external laws – suffers a loss. The risk of error is therefore caused by human error and includes, above all, input errors, clerical errors… read more »

The empirically proven fact that a loss on an investment is felt less strongly by investors if it occurs by the middle of the investment period. In this case, there is still enough time to compensate for the setback. With later losses this possibility is missing. Therefore, numerically equal loss is perceived more painfully now…. read more »

The profit, taking into account storage costs, to be gained from holding a good in readiness – i.e., having it in stock today – rather than having to procure it for use in the business or for sale to the customer (the extra advantage that firms derive from holding the product rather than the future)…. read more »

Pursuant to § 3 of the Remuneration Ordinance for Institutions, a compensation scheme is adequate if – incentives for management and employees to take disproportionately high risks are avoided and – the compensation scheme does not conflict with the monitoring function of the control units. – See bonus system, insurance compensation regulations. – Cf. BaFin… read more »

The amount payable when an option is extended beyond the original contract date and is extended through a subsequent contract (a premium paid when a buyer continues an option through a second option contract on extension date of the original contract). – Payment made by the owner of a compound option to the owner of… read more »

In the financial sense, the withdrawal of money from a cash register for payment purposes; correspondingly, it is referred to as collection. – The expression was already in the 19, Jht. as Unwort (misnomer: a mistaken or unsuitable term) reprimanded. However, it has been used to some extent up to the present day in addition… read more »

Banks in Germany are obliged to report to the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) if EX ANTE or EX POST there are indications that transactions violate the prohibition of insider transactions or market manipulation. Reporting a suspicion is an original obligation of an institute which differs from other legal requirements such as the… read more »

Said usually of (public) securities where there is no pre-determined issue period. The sale takes place continuously without a time limit. This makes it possible to achieve “noiseless” (discreet) financing with a relatively constant market burden. – See issuance calendar, tender, limited. Attention: The financial encyclopedia is protected by copyright and may only be used… read more »

In general, the contractually agreed or legally stipulated expiration of a period. – The end of the term of a financial contract. – On the stock exchange, the date on which the option can no longer be exercised. If it has an intrinsic value, the option right must have been exercised by this date at… read more »

Option contract which contains the right to sell – a good such as foreign exchange, a financial instrument or a commodity – at a certain price – within a specified period of time. – A put option is bought when it is believed that the price of the commodity in question will fall. The seller… read more »