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Equity derivative: Difference between revisions
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High [[delta]] [[equity derivatives]] that replicate the economic effect of cash [[equities]] trading are often called “[[synthetic equity swaps]]” or “[[synthetic prime brokerage]]”. | High [[delta]] [[equity derivatives]] that replicate the economic effect of cash [[equities]] trading are often called “[[synthetic equity swaps]]” or “[[synthetic prime brokerage]]”. | ||
====Types of equity derivative==== | The starting assumption is that the underlying share already exists in the market. So there's not a lot of chat about initial publis offerings, subscription agreements and all that sort of thing. So the sorts of rights an initial subscriber might have (the {{eqderivprov|Hedging Party}}) won’t automatically translate through to the holder of a synthetic exposure under an [[equity derivative]]. | ||
====Types of [[equity derivative]]==== | |||
*[[Equity swap]] contracts, which are generally [[total return swap]]s and related [[index swap]] contracts | *[[Equity swap]] contracts, which are generally [[total return swap]]s and related [[index swap]] contracts | ||
*{{eqderivprov|Option}} contracts | *{{eqderivprov|Option}} contracts | ||
*{{eqderivprov|Forward}} contracts | *{{eqderivprov|Forward}} contracts | ||
*[[Synthetic prime brokerage]]: [[delta-one]] exposure; a swap version of pure share brokerage. | |||
====Features==== | ====Features==== | ||