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Where do you start?
Where do you start?
:{{derivativecontractdefinition}}


MiFID definition of [[derivative]] comes from the latter half (items (4) - (10)) of the definition of "Financial Instruments" set out in Section C of Annex I to {{tag|MiFID}} as follows:
{{tag|MiFID}} definition of [[derivative]] comes from the latter half (items (4) - (10)) of the definition of "[[Financial instrument - FCA Rulebook Term|Financial Instruments]]" set out in Section C of Annex I to {{tag|MiFID}} as follows:


{{box|
{{box|
Financial Instruments
[[Financial instrument - FCA Rulebook Term|Financial Instruments]]


(1) [[Transferable securities]]; <br>  
(1) [[Transferable securities]]; <br>  

Revision as of 13:17, 27 March 2017

Where do you start?

‘derivative’ or ‘derivative contract’ means a financial instrument as set out in points (4) to (10) of Section C of Annex I to 2004/39/EC (EUR Lex)[1] as implemented by Article 38 and 39 of 1287/2006 (EUR Lex);

MiFID definition of derivative comes from the latter half (items (4) - (10)) of the definition of "Financial Instruments" set out in Section C of Annex I to MiFID as follows:

Financial Instruments

(1) Transferable securities;
(2) Money-market instruments;
(3) Units in collective investment undertakings [AKA UCITS;
(4) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to securities, currencies, interest rates or yields, or other derivatives instruments, financial indices or financial measures which may be settled physically or in cash;
(5) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to commodities that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event);
(6) Options, futures, swaps and any other derivative contract relating to commodities that can be physically settled provided that they are traded on a regulated market and/or an MTF;
(7) Options, futures, swaps, forwards and any other derivative contracts relating to commodities, that can be physically settled not otherwise mentioned in C.6 and not being for commercial purposes, which have the characteristics of other derivative financial instruments, having regard to whether, inter alia, they are cleared and settled through recognised clearing houses or are subject to regular margin calls; (8) Derivative instruments for the transfer of credit risk;
(9) Financial contracts for differences;
(10) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to climatic variables, freight rates, emission allowances or inflation rates or other official economic statistics that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event), as well as any other derivative contracts relating to assets, rights, obligations, indices and measures not otherwise mentioned in this Section, which have the characteristics of other derivative financial instruments, having regard to whether, inter alia, they are traded on a regulated market or an MTF, are cleared and settled through recognised clearing houses or are subject to regular margin calls.




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By Instrument

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Supporting Documentation

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Hedging

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US registration
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    • Regulation S
    • Rule 144A

Structured Securities

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Derivatives

Swaps

ISDA
Non-ISDA

Spot and Short Term Derivatives

These contracts are not necessarily traded under an ISDA framework but may will be traded according to Exchange rules or financial institutions' "Standard Terms of Business"

Securities Financing

Stock Lending

Repurchase Agreements

Commodities Trading

Financial

Physical

Oil and Refined Products
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Energy
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Metals
  • Base Metals
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Agrigultural Commodities

Commodities Documentation

Prime Brokerage

(in scope?)

Derivative Transactions

Market Risk

Asset Class

Market Disruption
Gap Risk

Credit Risk

Collateral and Credit Support

Collateral

Overview
Credit Support Annex
  • 1994 NY Pledge form of CSA
  • 1995 english Law Title Transfer
Eligible Collateral
  • Cash
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  • Corporate Bonds
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    • Letters of Credit

Non-Collateral Credit Support

  • Guarantees
  • "Liens" and Security Interests

Intercreditors and Loan financing

Regulatory Environment

Implications for derivatives and capital markets transactions of regulatory initiatives. This should cross reference where appropriate the Financial Services Module

Supervision and Market Infrastructure

Investor Protection

Capital, Liquidity and Financial Stability

Regulations
Market Making
Netting
Risk Weighted Asset Classification

Mandatory Clearing

Suitability

  1. ↑ That’s MiFID and not MiFID II to its friends — even though MiFID II has updated somewhat the Section C of Annex I to include emissions certificates.
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