Insider Trading. Insider trading is a poorly defined concept with roots in adverse selection theory and the efficient market hypothesis (EMH). The popular notion is that insiders have an unfair advantage because they possess materially significant and non-public information â an informational asymmetry.
In format, a letter of guarantee is normally a short document that addresses a specific transaction. The text contains data that establishes the identity of the buyer, his or her relationship with the bank, and the nature and general value of the asset that is pledged as collateral.
For example a letter of credit could be used in the delivery of goods or the completion of a service. The seller may request that the buyer obtain a letter of credit before the transaction occurs. The buyer would purchase this letter of credit from a bank and forward it to the seller's bank. bank guarantee, like a line of credit, guarantees a sum of money to a beneficiary. Unlike a line of credit, the sum is only paid if the opposing party does not fulfill the stipulated obligations under the contract.