underwrite

Definition

To assume financial risk by guaranteeing payment or agreeing to buy unsold securities, essentially the business equivalent of being the backup friend who promises to buy all the unsold Girl Scout cookies. Investment banks underwrite stock offerings, insurance companies underwrite policies, and both pray they've done their math correctly. It's putting your money where someone else's mouth is.

Example Usage

Goldman Sachs agreed to underwrite the IPO, confident they could sell shares in a company that had never turned a profit.

Source: Investment banking terminology

Related Terms

Advanced

stepped-up basis

The readjustment of an asset's value for tax purposes when inherited, eliminating capital gains tax on appreciation that occurred during the deceased's lifetime. It's the tax code's way of saying 'fresh start' while making estate planners very wealthy.

💰 Finance / Accounting

Beginner

Accrual Basis

The accounting method where you recognize revenue when earned and expenses when incurred, regardless of when cash actually changes hands. It's like claiming you're rich because people owe you money, even if you're currently broke.

💰 Finance / Accounting

Intermediate

Capital Expenditure

Money spent on big-ticket items that a company will use for years, like equipment, buildings, or that espresso machine in the CEO's office. Accountants love CapEx because they get to depreciate it over time, which is basically financial foreplay.

💰 Finance / Accounting

Beginner

tax-free

The mythical unicorn of financial transactions: money that the government has graciously decided not to touch. Income or purchases that escape taxation, usually because lawmakers needed to incentivize something or felt charitable that particular legislative session. The two most beautiful words in accounting, often followed by fine print and eligibility requirements.

💰 Finance / Accounting

Advanced

parking

Temporarily moving assets or liabilities off the books through short-term sales with prearranged buyback agreements, essentially hiding things in plain sight. It's the financial equivalent of shoving everything into the closet before guests arrive.

💰 Finance / Accounting

Intermediate

taxation

The art of transferring wealth from citizens to government coffers through a bewildering array of forms, deductions, and loopholes that require advanced degrees to navigate. It's the reason April 15th is the most dreaded day on the calendar and accountants drive nice cars. Somehow, despite everyone paying, roads still have potholes.

💰 Finance / Accounting

Translate This Term

See “underwrite” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.

Try the Translator

Share This Term

Post on X Share on Facebook Share on LinkedIn

Discover a Term

Intermediate

Redneck MacGyvered

The fine art of fixing or building something using only materials found in a garage, gas station, or tackle box—typica...