Investment
Due Diligence
Also known as: Investment Research, Risk Assessment, Financial Analysis
Comprehensive investigation and analysis of an investment opportunity to assess risks and verify claims.
Detailed Explanation
Due Diligence is the systematic process of researching and analyzing an investment before committing funds. For corporate FDs, it involves examining the issuer's credit rating, financial statements, business model, management quality, and market position. Due diligence helps investors understand risks, verify claims, and make informed decisions. It's particularly important for corporate FDs since they lack deposit insurance protection and depend entirely on issuer creditworthiness.