Segregated Portfolio

   

Definition: a Segregated Portfolio is a mechanism used by mutual funds to protect the interests of all investors in case of a credit event, and also to deal with liquidity risk.
The main objective of a segregated portfolio is to handle defaulted bonds in the portfolio separately so that the original scheme is not greatly affected by stopping investors from buying at low price to take advantage of the price appreciation a little later after the default dues are cleared.


   

   

More on segregated portfolios.
More on investing: Alternative Investments, Asset Management, Break-even Point, BRIC Countries, Capital Structure, more...



   

MBA Brief offers brief, yet very accurate definitions of MBA concepts, frameworks, methods and models. We keep it short and provide some links in case you'd like to learn more around a subject.




© 2020 MBA Brief - Last updated: 25-11-2020  -  Privacy   |   Terms