Template:Extraordinary events capsule: Difference between revisions

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 Break these “'''{{eqderivprov|Extraordinary Events}}'''” into four categories:
-*'''[[Corporate action]]s on {{eqderivprov|Issuer}}s''': (generally) benign but unscheduled matters of corporate structure concerning the management of specific underlying {{eqderivprov|Shares}}, that change the economic proposition represented by those {{eqderivprov|Shares}}, and not the [[equity derivative]] contract. So: {{eqderivprov|Merger Event}}s and {{eqderivprov|Tender Offer}}s;
-*'''[[Index Adjustment Event - Equity Derivatives Provision|Index adjustments]]''': Equivalent measures that relate to an underlying {{eqderivprov|Index}} - collectively {{eqderivprov|Index Adjustment Event}}s. So:
+'''Corporate events on Issuers''': {{eqderivprov|Corporate Event}}s are generally benign<ref>“Benign” from the point of view of the target company’s solvency and market prospects; not quite so benign from its  management team’s prospects of ongoing employment.</ref> but not always expected or even wanted adjustments to the corporate structure and management of specific underlying {{eqderivprov|Shares}} — {{eqderivprov|Tender Offer}}s, {{eqderivprov|Merger}}s, management buyouts and events that change the economic proposition represented by those {{eqderivprov|Shares}}, and not the [[equity derivative]] contract. So: {{eqderivprov|Merger Event}}s and {{eqderivprov|Tender Offer}}s;
-:*''{{eqderivprov|Index Modification}}'': Changes in the calculation methodology for the {{eqderivprov|Index}}
-:*''{{eqderivprov|Index Cancellation}}'': Where {{eqderivprov|Index}}es are discontinued with replacement;
+'''Index adjustments''': For {{eqderivprov|Index}} trades, unexpected adjustments and  changes to methodologies and publishing strategies of underlying {{eqderivprov|Index}} (as opposed to changes in the composition of the Index according to its pre-existing rules) — collectively call these “{{eqderivprov|Index Adjustment Event}}s”. So:
-:*''{{eqderivprov|Index Disruption}}'': disruption in the calculation and publication of {{eqderivprov|Index}} values;
+:'''{{eqderivprov|Index Modification}}''': Changes in the calculation methodology for the {{eqderivprov|Index}}
-*'''Negative events affecting {{eqderivprov|Issuer}}s''': {{eqderivprov|Nationalization}}s, {{eqderivprov|Insolvency}}, {{eqderivprov|Delisting}} of underlying {{eqderivprov|Issuer}}s;
+:'''{{eqderivprov|Index Cancellation}}''': Where {{eqderivprov|Index}}es are discontinued with replacement;
-*'''{{eqderivprov|Transaction}} disruption''': These often do have some crossover with market events above, but the emphasis here is the direct impact on the parties’ abilities to perform and hedge the {{eqderivprov|Transaction}}. So, the {{eqderivprov|Triple Cocktail}} of {{eqderivprov|Change in Law}}, {{eqderivprov|Hedging Disruption}} and {{eqderivprov|Increased Cost of Hedging}}; the specific issues relating to short-selling ({{eqderivprov|Loss of Stock Borrow}} and {{eqderivprov|Increased Cost of Stock Borrow}}) and then two random ones that don’t brilliantly fit with this theory, and which people tend to disapply — possibly for that exact reason, but they are fairly well covered by the {{eqderivprov|Triple Cocktail}} anyway — {{eqderivprov|Failure to Deliver}} on account of illiquidity and, even more randomly, {{eqderivprov|Insolvency Filing}}<ref>especiaklly since there is already an {{eqderivprov|Insolvency}} event covering most of this). <br>
+:'''{{eqderivprov|Index Disruption}}''': disruption in the calculation and publication of {{eqderivprov|Index}} values;
+'''Negative events affecting Issuers''': {{eqderivprov|Nationalization}}s, {{eqderivprov|Insolvency}}, {{eqderivprov|Delisting}} of underlying {{eqderivprov|Issuer}}s;
+'''{{eqderivprov|Additional Disruption Events}}''': Events which directly impair performance and risk management of the {{eqderivprov|Transaction}} itself. These often cross over with market- and {{eqderivprov|Issuer}}-dependent events above, but the emphasis here is their direct impact on the parties’ abilities to perform and [[hedge]] the derivative {{eqderivprov|Transaction}} itself. So:
+:'''The {{eqderivprov|Triple Cocktail}}''': The {{eqderivprov|Triple Cocktail}} of {{eqderivprov|Change in Law}}, {{eqderivprov|Hedging Disruption}} and {{eqderivprov|Increased Cost of Hedging}};
+:'''[[Stock borrow]] events''': Specific issues relating to [[short-selling]] ({{eqderivprov|Loss of Stock Borrow}} and {{eqderivprov|Increased Cost of Stock Borrow}}); and
+:'''Random ones that aren’t needed or used''': Two random ones that don’t brilliantly fit with this theory, and which people tend to disapply — possibly for that exact reason, but they are fairly well covered by the {{eqderivprov|Triple Cocktail}} anyway — {{eqderivprov|Failure to Deliver}} under the {{eqderivprov|Transaction}} on account of illiquidity and, even more randomly, {{eqderivprov|Insolvency Filing}}<ref>especially since there is already an “{{eqderivprov|Insolvency}}” event covering most of this).</ref>. <br>