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This is an agency agreement whereby a prime broker client (called the "{{isdaprov|Designated Party}}") may enter transactions under an {{isdama}} with an executing broker (called the "{{isdaprov|Dealer}}") on behalf of the {{isdaprov|Designated Party}}'s {{isdaprov|Prime Broker}}. There is never a principal-principal contract between the {{isdaprov|Designating Party}} and the {{isdaprov|Dealer}}. | This is an agency agreement whereby a prime broker client (called the "{{isdaprov|Designated Party}}") may enter transactions under an {{isdama}} with an executing broker (called the "{{isdaprov|Dealer}}") on behalf of the {{isdaprov|Designated Party}}'s {{isdaprov|Prime Broker}}. There is never a principal-principal contract between the {{isdaprov|Designating Party}} and the {{isdaprov|Dealer}}. | ||
Compare that to the cash equity give-up process, where the prime broker client seeks a price indication from the executing broker, but never transacts any trade at all, but rather instructs its prime broker to do so. | Ironically - amusingly even, if ISDA documentation can ever said to be even faintly amusing - there is no give-up under this arrangement - there's only ever one contract between Dealer and Prime Broker - so the document is a misnomer of sorts. | ||
Compare that to the cash equity give-up process, where the prime broker client seeks a price indication from the executing broker, but never transacts any trade at all, but rather instructs its prime broker to do so. This one is a misnomer to, amusingly enough*, since here, also, there is never a contract that is given up. | |||
{{isdaanatomy}} | {{isdaanatomy}} | ||
*If that sort of thing floats your boat. |