Back Up
Barron's Accounting Dictionary:
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Back Up
To make a duplicate copy of original data or files usually stored on a separate data storage medium. Backup ensures the recoverability of files in the event of loss of the original data.
| Back Order, Back Charge, BUG | |
| Backflush Costing, Backup Withholding, Bad Debt |
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Back Up
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A slang term for the movement in spread, price or yield of a security, which makes it more expensive to issue. Back up is characterized by an increase in bond yields and a decrease in price. The price of a security "backs up" when a company finds the security more costly to issue when raising funds.
Investopedia Says:
When a back up occurs, the fund raising efforts of a company are diminished. For example, if interest rates increase, the required yields on most bonds will rise as well. This forces a company to either raise the coupon on their bond issue, which increases the interest payment, or sell the bonds at a discount, reducing the level of incoming cash.
Related Links:
Find out what happens when short-term interest rates exceed long-term rates. The Impact Of An Inverted Yield Curve
By understanding the factors that influence interest rates, you can learn to anticipate their movement and profit from it. Interest Rates And Your Bond Investments
Investing in bonds - What are they, and do they belong in your portfolio? Bond Basics Tutorial
Not sure what to do if a company invites you to buy more shares at discount? Here are some of your options. Understanding Rights Issues
Treasuries are considered the safest investments, but they should still be analyzed when issued. Basics Of Federal Bond Issues
Borrowed funds can mean a leg up for companies, or the boot for investors. Find out how to tell the difference. Will Corporate Debt Drag Your Stock Down?
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Barron's Accounting Dictionary
Dictionary of Accounting Terms. Copyright © 2010 by Barron's Educational Series, Inc. All rights reserved.
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