4 ms·
If you can expect to be bailed outif the debtor defaults, then yes, you should use the risk free rate for discounting.
by tomp 11y ago
If you can expect to be bailed outif the debtor defaults, then yes, you should use the risk free rate for discounting.
- derriz 11y agoNope - haircuts are calculated relative to current asset values. For example, when discussing the haircut on a 100m greek bond that's currently trading for 60m, giving the holder 60m for it does not constitute a 40% haircut.