What Is Subprime? Subprime is a below-average credit classification of borrowers with a tarnished or limited credit history, and which are subject to higher than average interest rates. Lenders will use a credit scoring system to determine which loans a borrower may qualify for. Subprime loans carry more credit risk, and as such, will carry
What Is a Subprime Auto Loan? A subprime auto loan is a type of loan used to finance a car purchase that’s offered to people with low credit scores or limited credit histories. Subprime loans carry higher interest rates than comparable prime loans and may also come with prepayment penalties if the borrower chooses to
What Is Subprime Credit? Subprime credit refers to loans, usually offered at rates well above the prime rate, made to borrowers with poor credit ratings. Key Takeaways Subprime credit refers to loans, usually offered at rates well above the prime rate, made to borrowers with poor credit ratings.Subprime credit is, often, the only type of
The Subprime Market: An Overview The subprime market is the segment of the financing business that relates to loans made to people or businesses who pose a greater risk of default because of their poor credit history or limited resources. Subprime simply means below prime or less than ideal. Unscrupulous behavior in the subprime market
What Is a Subprime Borrower? A subprime borrower is a person considered to be a relatively high credit risk for a lender. Subprime borrowers have lower credit scores and are likely to have multiple negative factors in their credit reports, such as delinquencies and account rejections. Subprime borrowers may also have a “thin” credit history
What Is a Strip Bond? A strip bond is a debt instrument in which both the principal and regular coupon payments—which have been removed—are sold separately. A strip bond is also known as a zero-coupon bond. key takeaways A strip bond is a debt obligation whose principal and coupon payments are removed (or stripped) by
What Is a Stripped Yield? Stripped yield is a measure of the non-collateralized, independent return of a bond or warrant after all the monetary incentives and features have been removed. Stripped yields measures the return on only the debt portion of a bond or warrant, and so removes the impact of any embedded options, or
What Is Strong Form Efficiency? Strong form efficiency is the most stringent version of the efficient market hypothesis (EMH) investment theory, stating that all information in a market, whether public or private, is accounted for in a stock’s price. Practitioners of strong form efficiency believe that even insider information cannot give an investor an advantage. This
What Is a Strong Sell? A strong sell is a type of stock trading recommendation given by investment analysts for a stock that is expected to dramatically underperform when compared with the average market return and/or return of comparable stocks in the same sector or industry. It is an emphatic negative comment on a stock’s prospects. Key
What Is the Stroud Pound? The Stroud pound is a private currency introduced in the British town of Stroud, Gloucestershire, in September 2009. It was launched to support the local economy by encouraging consumers to buy local produce and other goods and services, thereby encouraging the development of local businesses and jobs. Key Takeaways The Stroud
