Template:M intro isda ISDA purpose: Difference between revisions

The {{isdama}} is, as we know, a framework under which two “[[counterparties]]” can transact [[over-the-counter]] derivatives — [[swap]] contracts. Besides its original appeal as an [[affordance]] it has three main aims: it is a [[relationship contract]]; it is a [[Credit risk mitigation|credit risk management tool]], and it is a [[capital optimisation]] tool.

[[File:Wedding.jpg|250px|thumb|right|A relationship contract, yesterday.]]

Firstly, the Master Agreement is a [[relationship contract]]: a legal agreement establishing the basic relationship between the parties, reciting their aspirations, dealing with housekeeping, setting out contact details and process agents, setting up the transaction process to make trade time as simple and streamlined as possible, and generally setting up the economic parameters within which the parties agree to transact [[from time to time]].