Template:Type of Return and swaps on futures: Difference between revisions

If you have an {{eqderivprov|Equity Swap Transaction}} referencing a [[future]], some debate — not all of it necessarily fruitful, but undoubtedly special in the hearts of those who enjoy [[metaphysics|metaphysical]] conundrums — can be had as to whether one should select {{eqderivprov|Price Return}} or {{eqderivprov|Total Return}} as your {{eqderivprov|Type of Return}}, but since [[futures]] don’t generally pay dividends, on point of practical fact there is not a lot of difference, so such debate can aggravate intensely practical people  such as my little sister, who despair of metaphysical conundrums.

But okay, dammit, let’s hop off the fence and stick [[Occam’s razor]] into the ointment: Since {{eqderivprov|Total Return}} is {{eqderivprov|Price Return}} with some extra fiddly bits relating to dividends — including the need to choose whether or not you want your dividends [[deemed]] to be reinvested — then all other things being equal — such as when, as for futures, there ''are'' no dividends for you to elect whether or not to reinvest — {{eqderivprov|Price Return}} is the simpler, and therefore preferred, definition. ''There'': for {{eqderivprov|Equity Swaps}} on [[futures]], go for {{eqderivprov|Price Return}}.