Template:M summ Equity Derivatives 8.7: Difference between revisions

Now to calculate your {{eqderivprov|Equity Amount}}, we take the {{eqderivprov|Equity Notional Amount}} (for ease of calculation, say USD1,000,000?) and times it by the {{eqderivprov|Rate of Return}}:

===Shorts, longs and flexi-transactions===

Now as you know, the {{isdama}} is a bilateral construct — In a funny way, a bit [[Bob Cunis]] like that — and while the [[equity derivatives]] market is largely conducted between dealers and their clients. This doesn’t mean the [[dealer]] is always the {{eqderivprov|Equity Amount Payer}}. The client — as often as not, a [[hedge fund]] — is as likely to be taking a [[short]] position — [[locusts]], right? — as a [[long one]]. One does this by reversing the roles of the parties in the {{eqderivprov|Confirmation}}: The {{eqderivprov|Equity Amount Payer}} for a ''long'' transaction will be a [[Swap dealer|dealer]]. The {{eqderivprov|Equity Amount Payer}} for a ''[[short]]'' transaction will be the [[Hedge fund|fund]].