What term describes the facilitation of a financial transaction by a third party?

The term that describes the facilitation of a financial transaction by a third party is intermediation. Intermediation involves an intermediary, such as a bank or financial institution, which acts as a bridge between parties engaged in a transaction. This third party can provide services such as processing payments, managing funds, or facilitating communication between buyers and sellers.

In financial markets, this role is crucial because it helps to reduce information asymmetry, enables access to capital, and often provides additional services such as credit analysis, risk management, and transaction security. The intermediary's involvement can enhance the efficiency of the transaction by bringing together parties who may not have otherwise connected directly.

The other terms relate to different concepts. Investment refers to the allocation of resources, usually money, to generate income or profit. A joint venture describes a business arrangement in which two or more parties agree to pool resources for a specific goal while retaining their distinct identities. Judicial foreclosure is a legal process where a lender seeks to recover the balance of a loan from a borrower who has defaulted by forcing the sale of the asset used as collateral. Each of these concepts functions differently in the finance sector compared to intermediation, which specifically revolves around the facilitation of transactions.