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| {{csasnap|Independent Amount}} | | {{manual|MCAE|1995|Independent Amount|Paragraph|Independent Amount|medium}} |
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| ===Discussion===
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| {{variationmargindescription}}
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| If you look at it cold, this looks like a fixed currency amount that is paid at the beginning of a relationship, irrespective of how many {{isdaprov|Transactions}} you may have on. But it will be often defined as “an amount agreed between the parties or as otherwise advised by Party X”, which rather kicks the issue in to touch. In practice, it’s likely to be articulated as a multiplier on notional, and will be payable at the start of each {{isdaprov|Transaction}}, and may be adjusted on the fly.
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| Particularly where underlying trades and markets are volatile, expect to see a lot of customisation here.
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| *The {{csaprov|independent amount}} might be calculated by reference to a given multiplier for a given asset (or type of assets - it is not uncommon to see tiering in FX transactions, for example, where {{isdaprov|Transaction}}s on currencies in the highest Tier might have a low (say 2%) multiplier, and {{isdaprov|Transaction}}s on currencies in the lowest Tier might carry a a 100% multiplier).
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| *Especially where one counterparty is providing access to markets for the other party (so called [[synthetic prime brokerage]]) there may be a provision that the {{ca}} can adjust tiers, multipliers, and the assets which are elgible for each tier in its discretion, and with effect to existing as well as new transactions. This can have the effect of retroactively adjusting {{csaprov|Independent Amount}}s, in which case the difference can be called under the ordinary {{csaprov|Transfer}} provisions.
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| ===See also===
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| *[[Initial margin]]
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| {{csaanatomy}}
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