Exchange - Equity Derivatives Provision

2002 ISDA Equity Derivatives Definitions A Jolly Contrarian owner’s manual™ Resources and navigation Resources About the Equity Derivatives Definitions | (full wikitext) | (nutshell wikitext) | Equity v credit derivatives showdown Hot topics Synthetic Prime Brokerage Anatomy | The Triple Cocktail | Cancellation and Payment | Calculation Agent Resources About the Equity Derivatives Definitions | (full wikitext) | (nutshell wikitext) | Equity v credit derivatives showdown Hot topics Synthetic Prime Brokerage Anatomy | The Triple Cocktail | Cancellation and Payment | Calculation Agent TOC | 1 General Definitions | 2 Option Transactions | 3 Exercise of Options | 4 Forward Transactions | 5 Equity Swap Transactions | 6 Valuation | 7 Settlement | 8 Cash Settlement | 9 Physical Settlement | 10 Dividends | 11 Adjustments and Modifications | 12 Extraordinary Events · 12.8 Cancellation Amount · 12.9 Additional Disruption Events · 12.9 List of ADEs · 12.9(b) Consequences of ADEs | 13 Miscellaneous Index: Click ᐅ to expand: Equity Derivatives - Premium Synthetic Prime Brokerage Section 1.25 in a Nutshell™ Use at your own risk, campers! 1.25. “Exchange” means each specified exchange for an Index or Share (and any Alternative Exchange). view template Full text of Section 1.25 Section 1.25. Exchange. “Exchange” means: 1.25(a) in respect of an Index relating to an Index Transaction or Index Basket Transaction, each exchange or quotation system specified as such for such Index in the related Confirmation, any successor to such exchange or quotation system or any substitute exchange or quotation system to which trading in the Shares underlying such Index has temporarily relocated (provided that the Calculation Agent has determined that there is comparable liquidity relative to the Shares underlying such Index on such temporary substitute exchange or quotation system as on the original Exchange); and 1.25(b) in respect of a Share relating to a Share Transaction or Share Basket Transaction, each exchange or quotation system specified as such for such Share in the related Confirmation, any successor to such exchange or quotation system or any substitute exchange or quotation system to which trading in the Share has temporarily relocated (provided that the Calculation Agent has determined that there is comparable liquidity relative to such Share on such temporary substitute exchange or quotation system as on the original Exchange). view template Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

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Summary

Relevant to the definition of Market Disruption Event. Note also the related concept of the “Related Exchange” — a real ISDA definition, and Alternative Exchange, which is a JC fabrication we just made up because the “substitute or successor exchange offering comparable liquidity” language, which gets repeated a lot, is so tedious.

The JC’s definition if Alternative Echange - and remember this is fan fiction, okay? Not canonical — is:

An “Alternative Exchange”, in relation to any Exchange, is any successor or substitute exchange to which trading in the underlying Shares may have relocated (as long as the Calculation Agent is satisfied that it offers comparable liquidity)

The limbs are:

• 1.25(a), relating to Indices and
• 1.25(b), relating to Shares.

They are, mutatis mutandis, the same, only 1.25(a) talks about “Shares underlying the Index” which obviously isn’t needed when referring to Shares themselves.

Not to be confused, however tempting and, really, forgiveable it may be, with a Related Exchange under paragraph 1.26. A Related Exchange (real) is not the same as an Alternative Exchange (made up by the JC)

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See also

• Section 1.26 Related Exchange

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