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.
A bank guarantee or letter of credit is a way for the parties to a contract to ensure that the transfer of money from the buyer to the seller goes through. Instead of sending payment directly to the seller, the buyer purchases a letter of credit from a bank and sends that to the seller.