Tag: Derivatives contracts
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Related Exchange
Concept of Related Exchange in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The principal derivatives exchange on which listed options or futures contracts on the share or index are traded.ResourcesSee AlsoDerivatives Contract
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Obligation
Obligation AccelerationConcept of Obligation Acceleration in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A credit event term used in a credit derivative (i.e. an instrument that transfers risk from one party to the other) when one or more […]
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Credit Event
Concept of Credit Event in Futures TradingIn this context of financial law, the following is a definition of Credit Event: An event such as a debt default or bankruptcy that will affect the payoff on a credit derivative, as defined in the derivative agreement.
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Delta
Concept of Delta in Futures TradingIn this context of financial law, the following is a definition of Delta: A calculation of the expected change in an option’s price given a one-unit change in the price of the underlying commodity or asset. For example, the price of an option with a delta of […]
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Business Day
Bad (non Working) Business DayConcept of Bad (non Working) Business Day in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A day on which it is not possible to make payments, or days on which banks are not open for business. Bad business days […]
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Price Differential
Strike Price DifferentialConcept of Strike Price Differential in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The difference between the settlement price and the strike price at the point of option exercise.ResourcesSee AlsoDerivatives Contract
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Closing Trade
Concept of Closing Trade in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A bought or sold trade which is used partly to offset an open position, or fully offset it and close it out.ResourcesSee AlsoDerivatives Contract
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Platform
Thunderhead NowConcept of Thunderhead Now in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A technology platform used for OTC (over the counter) trade confirmations and term sheet generation. Thunderhead NOW provides the straight through […]
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Ask Price
Offer/ask PriceConcept of Offer/ask Price in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The price at which a trader or market maker is willing to sell a contract.ResourcesSee AlsoDerivatives Contract
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Date
Backload Effective Date (bed)Concept of Backload Effective Date (bed) in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): The date agreed between two parties, at which point the counterparties “snapshot” a portfolio of trades and send […]
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Exchange
Concept of Exchange in Futures TradingIn this context of financial law, the following is a definition of Exchange: A central marketplace such as a designated contract market with established rules and regulations where buyers and sellers meet to trade futures and options contracts or securities.
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Copula
Concept of Copula in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A statistical tool describing how the distribution of single risks join together to form joint risk distribution. Copulas are used in the valuation of synthetic CDO tranches […]
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Term Sheet
Concept of Term Sheet in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A document produced prior to execution indicating the financial terms and conditions of a specific transaction. The term sheet does not constitute a confirmation, or a […]
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Gamma
Concept of Gamma in Futures TradingIn this context of financial law, the following is a definition of Gamma: A measurement of how fast the delta of an option changes, given a unit change in the underlying futures price; the ‘delta of the delta.’
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Preceding Business Day Convention
Concept of Preceding Business Day Convention in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): A type of business day convention where payment days that fall on a bad business day roll backwards to the preceding good business day.ResourcesSee […]