group of mortgages, consumer loans, commercial loans, or other credit receivables acting as collateral for an issue of bonds, mortgage backed securities, or asset-backed securities. Any group of loans with similar qualities, i.e., term to maturity, interest rate, and so on, can be treated as a unit for purposes of securing pass-through securities, pay-through bonds, or multiclass bonds offered for sale to investors. Rules specifying the types of loans eligible for pooling are established by the issuer, and stated in the bond indenture agreement or the issuer's offering circular.
Corporate finance: concept that investment projects are financed out of a pool of funds rather than out of bonds, preferred stock, and common stock individually. Aweighted average cost of capital is thus used in analyses evaluating the return on investment projects.See also cost of capital.
Industry: joining of companies to improve profits by reducing competition. Such poolings are generally outlawed in the United States by various antitrust laws.
Insurance: association of insurers who share premiums and losses in order to spread risk and give small insurers an opportunity to compete with larger ones.
Investments: (1) combination of resources for a common purpose or benefit; (2) group of investors joined together to use their combined power to manipulate security or commodity prices or to obtain control of a corporation. Such pools are outlawed by regulations governing securities and commodities trading.
Real estate: a group of mortgages that are used as collateral for a pass-through security. See also blind pool.
Capital budgeting: as used in the phrase "pool of financing," the concept that investment projects are financed out of a pool of funds rather than out of bonds, preferred stock, and common stock individually. A weighted average cost of capital is thus used in analyses evaluating the return on investment projects. See also cost of capital.
Industry: joining of companies to improve profits by reducing competition. Such poolings are generally outlawed in the United States by various antitrust laws.
Insurance: association of insurers who share premiums and losses in order to spread risk and give small insurers an opportunity to compete with larger ones.
Investments:
- combination of resources for a common purpose or benefit. For example, an investment club pools the funds of its members, giving them the opportunity to share in a portfolio offering greater diversification and the hope of a better return on their money than they could get individually. A commodities pool entrusts the funds of many investors to a trading professional and distributes profits and losses among participants in proportion to their interests.
- group of investors joined together to use their combined power to manipulate security or commodity prices or to obtain control of a corporation. Such pools are outlawed by regulations governing securities and commodities trading.
syndicate or association of insurance companies or reinsurance companies organized to underwrite a particular risk, usually with high limits of exposure. Each member shares in premiums, losses, and expenses according to a predetermined agreement.
a water-filled tank or depression, used as an ornamental feature in a garden or, when large enough, for swimming.
Example: A backyard in-ground swimming pool is considered a desirable feature by most homeowners in Arizona.a group of mortgage loans or properties, typically used as security for a debt issue.
Example: A homogeneous group of mortgage loans was pooled by a mortgage banker to create a desirable portfolio for investors to consider.
