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Underwriting Definition

Underwriting is a process, which investment bankers utilize to raise capital for their investments. Generally, these are for large corporations or governments, who are issuing equity and/or debt securities.

Underwriting: An Age Old Process

Centuries ago, individuals would write their name down with the amount of risk they were willing to accept responsibility for. Today, the same practice is still in effect. Now, when new items come to the market, each firm has a specific amount of responsibility and risk within the specific investment.