Interest rates Interest rates In finance, accrued interest is the interest that has accumulated since the principal investment, or since the previous interest payment if there has been one already. For a financial instrument such as a bond, interest is calculated and paid in set intervals. ...more on Wikipedia about "Accrued interest"
Bank rate, sometimes also referred as rediscount rate, is the rate of interest which a central bank charges for loans and advances made available to commercial banks and other financial intermediaries. Changes in bank rate is widely used as a tool by the central banks to control the money supply. ...more on Wikipedia about "Bank rate"
In contrast to a nominal interest rate, the period of time after that the interest is credited coincides with the basic time unit (normally one year). Thus, given an interest rate of i, an initial capital is increased by the factor (1+i) after each time unit. ...more on Wikipedia about "Effective interest rate"
Eonia (Euro OverNight Index Average) is an effective overnight rate computed as a weighted average of all overnight unsecured lending transactions in the interbank market. It has been initiated within the euro area by the contributing panel banks. It is one of the two benchmarks for the money and capital markets in the euro zone (the other one being Euribor). ...more on Wikipedia about "Eonia"
Euribor (Euro Interbank Offered Rate) is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the euro wholesale (or "interbank") money market. ...more on Wikipedia about "Euribor"
The federal funds rate is the interest rate at which depository institutions lend balances ( federal funds) at the Federal Reserve to other depository institutions overnight. It is not (as the name might initially suggest) the rate at which the Fed lends to financial institutions. That is the discount rate. ...more on Wikipedia about "Federal funds rate"
The Fisher hypothesis is the proposition by Irving Fisher that the real interest rate is independent of monetary measures, especially the nominal interest rate. The Fisher equation is ...more on Wikipedia about "Fisher hypothesis"
A Forex swap is an over the counter short term interest rate derivative instrument. ...more on Wikipedia about "Forex swap"
An interest rate is the price a borrower pays for the use of money he does not own, and the return a lender receives for deferring his consumption, by lending to the borrower. Interest rates are normally expressed as a percentage over the period of one year. ...more on Wikipedia about "Interest rate"
In accounting and finance, the accrual basis of an interest calculation is a convention whereby an interest amount is calculated from the principal, expressed in units of a specified currency, and a percentage, and an agreed start and end date. The more commonly used conventions are listed below. ...more on Wikipedia about "Interest rate basis"
Interest rate risk is the risk that the relative value of a security, especially a bond, will worsen due to an interest rate increase. ...more on Wikipedia about "Interest rate risk"
In the field of derivatives, a popular form of swap is the interest rate swap, in which one party exchanges a stream of interest for another stream. Interest rate swaps are normally fixed against floating, but can also be fixed against fixed or floating against floating rate swaps. Interest rate swaps are often used by companies to re-allocate their exposure to interest-rate fluctuations, typically by exchanging fixed-rate obligations for floating rate obligations. ...more on Wikipedia about "Interest rate swap"
LIBOR stands for the London Interbank Offered Rate and is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the London wholesale (or "interbank") money market. ...more on Wikipedia about "LIBOR"
A nominal interest rate is the interest rate that does not compensate for inflation. ...more on Wikipedia about "Nominal interest rate"
In North American banking, the prime rate is the interest rate charged by lenders to borrowers who they consider most creditworthy. It varies little among banks, and adjustments are generally made by banks at the same time, although this does not happen with great frequency. ...more on Wikipedia about "Prime rate"
A reference rate is a rate that determines pay-offs in a financial contract and that is outside the control of the parties to the contract. It is often some form of LIBOR rate, but it can take many forms, such as a consumer price index, a house price index or an unemployment rate. The reference rate is normally determined by a third party. It must be independent, to avoid a conflict of interest - if one party has the ability to influence the rate, it is safe to assume that they will do so in their favour. ...more on Wikipedia about "Reference rate"
Risk-based pricing is the practice in the financial services industry to charge different interest rates on the same loan to different people, depending on their credit score and other factors which make it seem like they are more likely to not pay back the loan. Those with worse scores have a higher interest rate, those with better scores have a lower one. In most financial services companies and products, the credit score is by far the major element used to make this rate decision, income and assets are almost totally ignored (income however is used to decide if the loan is too high for the person to afford). The idea of the process is to avoid the tragedy of the commons, which happen if everyone had the same interest rate, since those who were less likely to default are in effect subsidizing those who do default. In risk-based pricing, those who are more likely to default help pay for their own costs to the company, while those who have flawless records get supposedly cheaper interest rates. ...more on Wikipedia about "Risk based pricing"
The risk-free interest rate is the interest rate that it is assumed can be obtained by investing in financial instruments with no risk. ...more on Wikipedia about "Risk-free interest rate"
SIBOR stands for Singapore Interbank Offered Rate and is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the Singapore wholesale (or "interbank") money market. It is similar to the widely used LIBOR (London Interbank Offered Rate), and Euribor (Euro Interbank Offered Rate). Using SIBOR is more common in the Asian region and set by the Association of Banks in Singapore (ABS). ...more on Wikipedia about "SIBOR"
SONIA is the Sterling OverNight Interbank Average. Launched in 1997, the weighted average is calculated using brokered unsecured overnight trades between banks listed under Section 43 of the Finanial Services Act 1986. ...more on Wikipedia about "Sonia"
In economics, the time preference theory of interest is the idea that interest is the price that borrowers put on having money now rather than having money later. ...more on Wikipedia about "Time preference theory of interest"
:This article deals with the Wall Street Journal Prime Rate. Also see Prime rate. ...more on Wikipedia about "Wall Street Journal prime rate"
The zero interest rate policy (ZIRP) is a Keynesian macroeconomics scheme for economies exhibiting slow growth with a very low interest rate, such as contemporary Japan. The Keynesian (and neo-Keynesian) thesis is that these countries are in the so-called liquidity trap, an assessment with which neoclassical economics disagrees. ...more on Wikipedia about "Zero interest rate policy"
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