Initial Price - Equity Derivatives Provision: Difference between revisions
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{{eqderivsnap|5.8}} | {{eqderivsnap|5.8}} | ||
Used in {{eqderivprov|Rate of Return}}, | Used in {{eqderivprov|Rate of Return}}, which in turn is used in {{eqderivprov|Equity Amount}}, and also very relevant to the {{eqderivprov|Equity Notional Reset}} process. The {{eqderivprov|Initial Price}} is different to the {{eqderivprov|Equity Notional Amount}} in that it is expressed as a price ''per {{eqderivprov|Share}}'', whereas the {{eqderivprov|Equity Notional Amount}} tends to be {{eqderivprov|Initial Price}} * {{eqderivprov|Number of Shares}}. | ||
Note there is an ''initial'' {{eqderivprov|Initial Price}} — the strike price in the {{isdaprov|Confirmation}} — but it is reset on every {{eqderivprov|Valuation Date}} to the {{eqderivprov|Final Price}} on that date — so the {{eqderivprov|Initial Price}} fluctuates over time. | Note there is an ''initial'' {{eqderivprov|Initial Price}} — the strike price in the {{isdaprov|Confirmation}} — but it is reset on every {{eqderivprov|Valuation Date}} to the {{eqderivprov|Final Price}} on that date — so the {{eqderivprov|Initial Price}} fluctuates over time. | ||