Template:Nutshell Equity Derivatives 11.2(b): Difference between revisions

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:{{eqderivprov|11.2(b)}} If the {{eqderivprov|Method of Adjustment}} for a {{eqderivprov|Share Transaction}} or {{eqderivprov|Share Basket Transaction}} is “'''{{eqderivprov|Options Exchange Adjustment}}'''” then following any adjustment to terms of options on  {{eqderivprov|Shares}} traded on any {{eqderivprov|Options Exchange}}, the {{eqderivprov|Calculation Agent}} will adjust any of the {{eqderivprov|Initial Price}}, {{eqderivprov|Strike Price}}, {{eqderivprov|Equity Notional Amount}}, {{eqderivprov|Number of Shares}}, {{eqderivprov|Number of Options}}, {{eqderivprov|Option Entitlement}}, {{eqderivprov|Knock-in Price}}, {{eqderivprov|Knock-out Price}}, {{eqderivprov|Forward Price}}, {{eqderivprov|Forward Floor Price}}, or {{eqderivprov|Forward Cap Price}} and any other relevant variable under that {{eqderivprov|Transaction}} as the {{eqderivprov|Calculation Agent}} thinks necessary], effective as of the effective date of the corresponding adjustment made by the {{eqderivprov|Options Exchange}}.
:{{eqderivprov|11.2(b)}}: '''{{eqderivprov|Options Exchange Adjustment}}''':If the {{eqderivprov|Method of Adjustment}} is “'''{{eqderivprov|Options Exchange Adjustment}}'''” then following adjustment to [[Options Exchange - Equity Derivatives Provision|exchange-traded options]] the {{eqderivprov|Calculation Agent}} will adjust any relevant variable under that {{eqderivprov|Transaction}} that it thinks necessary to reflect the {{eqderivprov|Options Exchange}} adjustment, effective as of the same date.  If there are’t any [[Options Exchange - Equity Derivatives Provision|exchange-traded options]] options on the {{eqderivprov|Shares}}, the {{eqderivprov|Calculation Agent}} will adjust the {{eqderivprov|Transaction}} as it thinks fit, by analogy to the {{eqderivprov|Options Exchange}}’s rules that would have applied had the options in question been traded on it. <br>
 
:If options on the {{eqderivprov|Shares}} are not traded on an {{eqderivprov|Options Exchange}}, the {{eqderivprov|Calculation Agent}} will adjust the {{eqderivprov|Transaction}} as it thinks fit, by reference to the {{eqderivprov|Options Exchange}}’s rules, to account for the dilution or concentration created by any event that would have led to an {{eqderivprov|Options Exchange}} adjustment had such options been traded on it. <br>

Revision as of 10:44, 24 January 2020

11.2(b): Options Exchange Adjustment:If the Method of Adjustment is “Options Exchange Adjustment” then following adjustment to exchange-traded options the Calculation Agent will adjust any relevant variable under that Transaction that it thinks necessary to reflect the Options Exchange adjustment, effective as of the same date. If there are’t any exchange-traded options options on the Shares, the Calculation Agent will adjust the Transaction as it thinks fit, by analogy to the Options Exchange’s rules that would have applied had the options in question been traded on it.
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