Fair Market Price- Fair market price is the price the asset would fetch if sold on the market immediately to a willing buyer.

 

Fat-Tail Event- A fat tail event is an event that is very unlikely to occur, may cause very significant losses or disruptions, or both.

 

Financial Asset- A financial asset derives its value from a specific contractual claim and includes bonds, loans, stocks, money, currency, derivatives, deposits, etc.

 

Financial Instrument- A financial instrument is a representation of an ownership interest claim or the contractual or contingent claim to receive or deliver cash, another financial instrument, or asset, and can either be a cash instrument (e.g., cash, securities, loans, bonds, notes, equity) or a derivative instrument (e.g., forward, future, option, and swap).

 

Financial Intermediation- Financial intermediation is the process bringing together those who need financing, such as businesses and governments, with those who provide financing, such as lenders, banks and private investors, and facilitating the flow of capital between them.

 

Financial Stability- Financial stability indicates that shocks and disturbances impacting the financial markets and financial institutions do not restrict their ability to continue intermediating financing, carrying out payments, and redistributing risk satisfactorily. 

 

Firm Value=  Market Value of Equity + Market Value of Debt

 

Fixed Assets/Total Assets- Estimated by dividing the cumulated book value of fixed assets, for the sector, by the cumulated total assets, for the sector.

 

Five C's of Credit- The 5C of credit is an abbreviation of a widely used credit analysis framework that focuses on the character of borrower, the capital provided by the borrower, the business, economic and other conditions faced by the borrower, the financial and legal capacity of the borrower, and the various types of collateral and other types of credit support mechanisms offered by the borrower.

 

Fixed Income Instrument- Fixed income instrument, such as a bond, provides fixed and known periodic interest payments and the repayment of the principal at maturity.

 

Fixed Interest Rate- A fixed interest rate is an interest rate that does not change over the life of a loan, bond or other form of credit.

 

Fixed Interest Rate Loan- A fixed interest rate loan is a loan where the interest rate on the loan does not change during the maturity of the loan.

 

Fixed Rate Bonds- A fixed rate bond is a bond where the coupon rate that determines the periodic interest rate payments does not change during the lifetime of the bond.

 

Floating Interest Rate- A floating interest rate (also called variable or adjustable rate) is an interest rate other than a fixed interest rate, and may change dependig on the peformance of an underlying index.

 

Floating Interest Rate Loan- A floating interest rate loan is a loan where the interest rate on the loan is tied to an underlying index or base rate and, as a result, may change during the life of the loan.

 

Floating Rate Bonds- A floating interest rate bond is a bond where the coupon rate on the bond is tied to an underlying index or base rate and, as a result, may change during the life of the bond.

 

Foreign Currency Cross Rate- A foreign currency cross rate is the exchange rate between two currencies against a third.

 

Foreign Exchange Rate- A foreign exchange rate specifies the price of one currency in terms of another currency.

 

Foreign Exchange Risk- Foreign exchange risk is the potential loss due to an adverse change in the value of a currency against another.

 

Forex Swap- A forex swap, a derivative, consists of the simultaneous buying and selling identical amounts of a currency for another currency at two different valuation dates; this type of swap is different from a currency swap.

 

Forward- A forward (contract), a derivative, is a contract that defines the delivery of specified asset (e.g., commodities, currencies, bonds or stocks), at a specified price, at a specified quantity, on a specified future date.

 

Forward Interest Rate- A forward interest rate is a rate to which a borrower and lender agree for a loan to be made in the future.

 

Forward Price- A forward price is the agreed upon price of an asset in a forward contract, and can be a forward interest rate or exchange rate.

 

Forward Rate Agreement (FRA)- A forward rate agreemnt is an OTC derivative contracts that allow banks to take positions in forward interest rates. The contract gives the right to lend/borrow funds at a fixed rate for a specified period starting in the future.

 

Foundation IRB Approach- The Foundation IBR Approach refers to a set of credit risk measurement techniques and capital adequacy rules outlined in the Basel II Accord. Under this approach, banks develop their own empirical models to quantify the probability of default estimate required to quantify their capital for credit risk.

 

Fractional Reserve Banking- Fractional reserve banking is a banking system where only a small fraction of the total deposits must be held in reserve with the balance available to be invested in loans and other securities.

 

Free Cash Flow to Firm (FCFF)=  EBIT(1-t) - (Capital Expenditures - Depreciation) - Change in non-cash Working Capital

For the sector as a whole, we compute this using cumulated values for each variable.

 

Free Cash Flow to Equity (FCFE)=  Net Income - (Capital Expenditures - Depreciation) - Change in non-cash Working Capital - (Principal repaid - New Debt Issued)

For the sector as a whole, we compute this using cumulated values for each variable.

 

Fundamental growth in EPS=  Retention Ratio * ROE

See descriptions of these variables for more detail.

 

Funding Liquidity- Funding liquidity refers to a bank's ability to have funds available to repay depositors on demand and to fund loans when needed.

 

Funding Liquidity Risk- Funding liquidity risk refers to a bank's potential inability to have funds available to repay depositors on demand and to fund loans when needed.

 

Futures Contract- A futures (contract), a derivative, is a standardized and transferable contract traded on an exchange that defines the delivery of specified asset (e.g., commodities, currencies, bonds or stocks), at a specified price, at a specified quantity, on a specified future date.

ר רועי פולניצר, MBA ,CRM , FRM הינו הבעלים של שווי פנימי - ייעוץ והדרכהשווי פנימי, רועי פולניצר, ניהול סיכונים, הערכות שווי, Intrinsic Value, Roi Polanitzer, Risk Management, Valuation, VaR, FRM. PRM, CRM. GARP, PRMIA, IARM