Use the Following Two Choices to Identify Whether Each Intermediary

question 64

Multiple Choice

Use the following two choices to identify whether each intermediary or entity is a net buyer or net seller of credit derivative securities.
Pension funds

• A)Net buyer (typically)
• B)Net seller (typically)

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Definitions:

Incidental Beneficiary

A third party who unintentionally benefits from a contract made between two other parties, without having any enforceable rights under that contract.

Novation

A legal process where an old debt, obligation, or contract is replaced by a new one, effectively extinguishing the original agreement and substituting it with a new party or terms.

Obligor

An Obligor is the party in a contractual agreement who is bound to provide a specified performance to another party, the obligee.

Obligee

The party in a contractual agreement who is owed a duty or obligation by another party, the obligor.