List the Requirements a Party Must Meet in Order to Be

question 78

Essay

List the requirements a party must meet in order to be considered a holder in due course.

---

Definitions:

Trading Securities

Financial instruments that are purchased by a company not for long-term investment but rather for the purpose of earning a return through short-term price fluctuations.

Fair Value

An estimate of the price at which an asset or liability would be traded in a fair transaction between willing parties.

Financial Statements

Descriptions giving insight into a business's financial situation, covering the balance sheet, income statement, and cash flow statement.

Trading Investments

Securities bought and held primarily for selling them in the near term to generate income on short-term price differences.