Calculation Agent - Equity Derivatives Provision
2002 ISDA Equity Derivatives Definitions
A Jolly Contrarian owner’s manual™ Calculation Agent in a Nutshell™
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Comparisons
A JC-curated sub-division of the General Definitions section. We sub-group the Section 1 definitions into the following subgroups:
- Transactions — Sections 1.1 - 1.12
- Underliers — Sections 1.13 - 1.16
- Trade Details — Sections 1.17 - 1.24
- Exchanges, Clearing Systems and Currencies — Sections 1.25 - 1.37
- Trade Features — Sections 1.38 - 1.41
- Calculation Agent and Determination Agent - Section 1.40 and 12.8(f)
- Knock-ins and Knock-outs — Sections 1.42 - 1.51
Basics
Note, distressingly, it doesn’t fall back to the Schedule if not defined in the Confirmation, which would have been a nice little accommodation. No doubt a legal eagle will tell you, you must therefore put a line in the Confirmation if there isn’t one there already.
Not a hill, if we were you, we would die on.
Calculation Agent and Determining Party
Negotiators of prime brokerage documentation will have great fun arguing the toss about the identity of the Calculation Agent, the Determination Agent and any dispute rights, challenges, fallbacks and other utterly pointless quibbles about whose job it is to come up with valuations. We discuss it in a bit more detail in the premium section, but in a nutshell, it is the dealer. Always. No exceptions. Even those who “win” this negotiation will learn that it is always the dealer.
Think about it this way: when you go to your favourite restaurant, do you take along your own menu?
You don’t, do you? Not even just in case the restaurateur happens to go bankrupt at the very moment she is meant to be bringing out the Crème Brulée with a sparkler on it.
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