Template:Eta vs close-out amount: Difference between revisions
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=====On the difference between an “Early Termination Amount” and a “Close-out Amount”===== | =====On the difference between an “Early Termination Amount” and a “Close-out Amount”===== | ||
The {{1992ma}} features ''neither'' an {{ | The {{1992ma}} features ''neither'' an {{isda|Early Termination Amount}} ''or'' a {{isdaprov|Close-out Amount}}, which many would see as a regrettable oversight. The {{2002ma}} has both, which looks like rather an indulgence until you realise that they do different things. | ||
A {{isdaprov|Close-out Amount}} is the termination value for a single {{ | A {{isdaprov|Close-out Amount}} is the termination value for a single {{{{{1}}}|Transaction}}, or a related group of {{{{{1}}}|Transaction}}s that a {{{{{1}}}|Non-Defaulting Party}} or {{{{{1}}}|Non-Affected Party}} calculates ''while'' closing out an {{2002ma}}, but it is ''not'' the final, overall sum due under the {{isdama}} itself. Each of the determined {{isdaprov|Close-out Amount}}s summed with the various {{{{{1}}}|Unpaid Amount}}s to arrive at the {{isdaprov|Early Termination Amount}}, which is the total net sum due under the {{isdama}} after the close-out process. (See Section {{{{{1}}}|6(e)(i)}} for more on that). | ||
Revision as of 17:16, 1 January 2024
On the difference between an “Early Termination Amount” and a “Close-out Amount”
The 1992 ISDA features neither an ISDA or a Close-out Amount, which many would see as a regrettable oversight. The 2002 ISDA has both, which looks like rather an indulgence until you realise that they do different things.
A Close-out Amount is the termination value for a single {{{{{1}}}|Transaction}}, or a related group of {{{{{1}}}|Transaction}}s that a {{{{{1}}}|Non-Defaulting Party}} or {{{{{1}}}|Non-Affected Party}} calculates while closing out an 2002 ISDA, but it is not the final, overall sum due under the ISDA Master Agreement itself. Each of the determined Close-out Amounts summed with the various {{{{{1}}}|Unpaid Amount}}s to arrive at the Early Termination Amount, which is the total net sum due under the ISDA Master Agreement after the close-out process. (See Section {{{{{1}}}|6(e)(i)}} for more on that).