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Fungible: Difference between revisions
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*'''Not fungible''': Securities from different series, even if issued by the same issuer, are ''not'' fungible with each other. | *'''Not fungible''': Securities from different series, even if issued by the same issuer, are ''not'' fungible with each other. | ||
*'''Fungible''': Individual securities comprising part of a single series (and having a the same [[ISIN]] ''are'' fungible with each other. | *'''Fungible''': Individual securities comprising part of a single series (and having a the same [[ISIN]] ''are'' fungible with each other. | ||
===Definition=== | ===Definition=== | ||
Assets are fungible where their nature allows them to be replaced in whole or in part with other assets of a like nature. However, it applies only to the equivalence of each unit of a commodity with other units of the same commodity. Fungibility does not describe or relate to any exchange of one commodity for some other, different commodity. | Assets are fungible where their nature allows them to be replaced in whole or in part with other assets of a like nature. However, it applies only to the equivalence of each unit of a commodity with other units of the same commodity. Fungibility does not describe or relate to any exchange of one commodity for some other, different commodity. | ||
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Money can also be considered a fungible asset. If you borrow £10 from someone, you do not need to give the same £10 note back. You could give that person another £10 note, or two £5 notes, or any combination of coins that add up to £10 (as long as they are happy to accept that many coppers!) | Money can also be considered a fungible asset. If you borrow £10 from someone, you do not need to give the same £10 note back. You could give that person another £10 note, or two £5 notes, or any combination of coins that add up to £10 (as long as they are happy to accept that many coppers!) | ||
===“[[Equivalent]]” and “[[fungible]]”: ''la même chose''=== | |||
Note: in financial markets speak, “[[equivalent]]” means ''[[fungible]]''. It doesn't mean "somewhat like". Go see our “[[equivalent]]” article for more. | |||
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*[[Equivalent]] | |||
*[[True sale opinion]] | |||