Default Risk

What does it mean?
The risk that companies or individuals will be unable to pay the contractual interest or principal on their debt obligations.

In Other Words...
In other words, this is the risk that you will not get paid.

Related Links
Corporate Bonds: An Introduction to Credit Risk - Corporate bonds offer higher yields, but it's important to evaluate the extra risk involved before you buy.

Junk Bonds: Everything You Need to Know - Don't be fooled by the name--junk bonds may be for you if you know how to analyze them.

Bond Basics Tutorial - What are bonds and do they belong in your portfolio? Get all the answers in this comprehensive tutorial.

Related Terms
Bankruptcy | Cross Default | Default | Mortgage

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