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Equity Notional Reset - Equity Derivatives Provision: Difference between revisions
Equity Notional Reset - Equity Derivatives Provision (view source)
Revision as of 17:25, 14 December 2015
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===Commentary=== | ===Commentary=== | ||
The Equity Notional Reset is a feature for automatically restriking the Equity Notional Amount on a periodic basis to the | The Equity Notional Reset is a feature for automatically restriking the Equity Notional Amount on a periodic basis to the prevailing value of the Equity Notional Amount. It has the effect of converting posted collateral - which for financial institutions may suffer a punitive capital treatment - into absolutely paid amounts. | ||
The swap will reset automatically on each [[Cash Settlement Payment Date - Equity Derivatives Provision|Cash Settlement Payment Date]], (i.e., usually a {{eqderivprov|Settlement Cycle}} after each {{eqderivprov|Valuation Date}}). | The swap will reset automatically on each [[Cash Settlement Payment Date - Equity Derivatives Provision|Cash Settlement Payment Date]], (i.e., usually a {{eqderivprov|Settlement Cycle}} after each {{eqderivprov|Valuation Date}}). | ||