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Also, fondly, known as a [[sw-ŏp]], but ''never'' a [[sw-æp]]. [[Swap does not rhyme with crap|Swaps aren’t, and don’t rhyme with, crap]].
Also, fondly, known as a [[sw-ŏp]], but ''never'' a [[sw-æp]]. [[Swap does not rhyme with crap|Swaps aren’t, and don’t rhyme with, crap]]. A [[financial instrument]], feared in Nebraska as some kind of [[Financial weapons of mass destruction|WMD]], in the cradle of the Levant as a sort of Godless gambling contract, amongst commodity producers of the Midwest (other than that one fellow in Omaha) as a legitimate hedging activity.


Could be a [[swap]], an [[option]] or a [[future]]
===Warning: boring stuff below this line===
Where do you start?
Where do you start?
:{{derivativecontractdefinition}}
:{{derivativecontractdefinition}}

Revision as of 15:50, 18 June 2019

The Jolly Contrarian’s Glossary
The snippy guide to financial services lingo.™


Index — Click the ᐅ to expand:

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ISDA Anatomy™
incorporating our exclusive ISDA in a Nutshell™

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Index: Click to expand:Navigation
The Varieties of ISDA Experience
Subject 2002 (wikitext) 1992 (wikitext) 1987 (wikitext)
Preamble Pre Pre Pre
Interpretation 1 1 1
Obligns/Payment 2 2 2
Representations 3 3 3
Agreements 4 4 4
EODs & Term Events 5

Events of Default
FTPDBreachCSDMisrepDUSTCross DefaultBankruptcyMWA
Termination Events
IllegalityTax EventTEUMCEUMATE

5

Events of Default
FTPDBreachCSDMisrepDUSTCross DefaultBankruptcyMWA
Termination Events
IllegalityTax EventTEUMCEUMATE

5

Events of Default
FTPDBreachCSDMisrepDUSTCross DefaultBankruptcyMWA
Termination Events
IllegalityFMTax EventTEUMCEUMATE

Early Termination 6

Early Termination
ET right on EODET right on TEEffect of DesignationCalculations

6

Early Termination
ET right on EODET right on TEEffect of DesignationCalculationsSet-off

6

Early Termination
ET right on EODET right on TEEffect of DesignationCalculationsSet-off

Transfer 7 7 7
Contractual Currency 8 8 8
Miscellaneous 9 9 9
Offices; Multibranch Parties 10 10 10
Expenses 11 11 11
Notices 12 12 12
Governing Law 13 13 13
Definitions 14 14 14
Schedule Schedule Schedule Schedule
Termination Provisions Part 1 Part 1 Part 1
Tax Representations Part 2 Part 2 Part 2
Documents for Delivery Part 3 Part 3 Part 3
Miscellaneous Part 4 Part 4 Part 4
Other Provisions Part 5 Part 5 Part 5

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Also, fondly, known as a sw-ŏp, but never a sw-æp. Swaps aren’t, and don’t rhyme with, crap. A financial instrument, feared in Nebraska as some kind of WMD, in the cradle of the Levant as a sort of Godless gambling contract, amongst commodity producers of the Midwest (other than that one fellow in Omaha) as a legitimate hedging activity.

Could be a swap, an option or a future


Warning: boring stuff below this line

Where do you start?

derivative’ or ‘derivative contract’ means a financial instrument as set out in points (4) to (10) of Section C of Annex I to 2004/39/EC (EUR Lex)[1] as implemented by Article 38 and 39 of 1287/2006 (EUR Lex);

MiFID definition of derivative comes from the latter half (items (4) - (10)) of the definition of "Financial Instruments" set out in Section C of Annex I to MiFID as follows:

Financial Instruments

(1) Transferable securities;
(2) Money-market instruments;
(3) Units in collective investment undertakings (UCITS);
(4) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to securities, currencies, interest rates or yields, or other derivatives instruments, financial indices or financial measures which may be settled physically or in cash;
(5) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to commodities that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event);
(6) Options, futures, swaps and any other derivative contract relating to commodities that can be physically settled provided that they are traded on a regulated market and/or an MTF;
(7) Options, futures, swaps, forwards and any other derivative contracts relating to commodities, that can be physically settled not otherwise mentioned in C.6 and not being for commercial purposes, which have the characteristics of other derivative financial instruments, having regard to whether, inter alia, they are cleared and settled through recognised clearing houses or are subject to regular margin calls; (8) Derivative instruments for the transfer of credit risk;
(9) Financial contracts for differences;
(10) Options, futures, swaps, forward rate agreements and any other derivative contracts relating to climatic variables, freight rates, emission allowances or inflation rates or other official economic statistics that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event), as well as any other derivative contracts relating to assets, rights, obligations, indices and measures not otherwise mentioned in this Section, which have the characteristics of other derivative financial instruments, having regard to whether, inter alia, they are traded on a regulated market or an MTF, are cleared and settled through recognised clearing houses or are subject to regular margin calls.

  1. That’s MiFID and not MiFID II to its friends — even though MiFID II has updated somewhat the Section C of Annex I to include emissions certificates.