What Is a Mutual Insurance Company? A mutual insurance company is an insurance company that is owned by policyholders. The sole purpose of a mutual insurance company is to provide insurance coverage for its members and policyholders, and its members are given the right to select management. Mutual insurance companies make investments in portfolios like a regular
What Is Mutualization of Risk? The mutualization of risk is the process of dividing up exposure to potential financial losses among several insurance policyholders, investors, businesses, organizations, or people. Mutualizing risk lowers the overall potential for significant financial loss to any one entity. However, it also lowers the potential pay-off to the single entity since the rewards
What Is Mutually Exclusive? Mutually exclusive is a statistical term describing two or more events that cannot happen simultaneously. It is commonly used to describe a situation where the occurrence of one outcome supersedes the other. For example, war and peace cannot coexist at the same time. This makes them mutually exclusive. Key Takeaways Events
What Is a Mutual Will? Mutual will is a type of will, usually executed by a married or committed couple, that is mutually binding. After one party dies, the remaining party is bound by the terms of the mutual will. This means that the remaining party can only alter the mutual will if they follow
What Is Market Value Added? Market value added (MVA) is a calculation that shows the difference between the market value of a company and the capital contributed by all investors, both bondholders and shareholders. In other words, it is the market value of debt and equity minus all capital claims held against the company. It is calculated
Myron Scholes is a Canadian-American economist and professor. He received the Nobel Prize in economics in 1997 for his contribution to the Black-Scholes model, a differential equation widely used to price options contracts. Scholes taught at the Massachusetts Institute of Technology and the University of Chicago. He is currently the Frank E. Buck Professor of
What Is the MSCI BRIC Index? The MSCI BRIC index measures the equity market performance of the emerging market indices of Brazil, Russia, India, and China. The MSCI BRIC Index is one of MSCI’s Regional Equity Indices and is a free float-adjusted, market capitalization-weighted index of four of the biggest emerging market economies. It was
What Is Nacha? Nacha is the steward of the electronic system that connects all U.S. bank accounts and facilitates the movement of money among them. According to the organization, $73 trillion moved through its Automated Clearing House (ACH) Network in 2021. Previously known as the National Automated Clearinghouse Association, Nacha is a non-profit association that is funded
What Is the National Association of Investors Corp.? The National Association of Investors Corp. (NAIC) is a nonprofit organization founded in 1951, and dedicated to providing investor education and promote investor success. The association is based in Madison Heights, Mich., and is composed of investing clubs along with individual investors from around the United States.
What Is the National Association of Insurance and Financial Advisors (NAIFA)? The National Association of Insurance and Financial Advisors (NAIFA) is a trade organization for insurance professionals and financial advisors, based in Virginia near Washington, D.C. It is one of the largest trade groups in the financial industry. NAIFA works on behalf of its members to promote
