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Template:Csa Valuation summ: Difference between revisions
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===={{{{{1}}}Valuation Date}}==== | ===={{{{{1}}}Valuation Date}}==== | ||
{{ | Each day on which you can expect to exchange [[variation margin]] under a Credit Support Annex, which is: | ||
{{l1}} | |||
'''{{1994csa}} and {{1995csa}}''': Whatever you specified in your elections paragraph and, the older your document is, the more likely it is to be an arbitrary and quite unnervingly long period. <li> | |||
'''{{2016nycsa}} and {{2016csa}}''': Unless otherwise specified in the elections paragraph, ''every'' day on which you’re both in the office in at least one of your {{{{{1}}}|Valuation Date Location}}s. ''Should'' the parties specify otherwise in their elections? No. Why would they? ''Will'' they? Experience suggests, for a dogged minority, they just might. Don’t be that guy. </ol> | |||
===={{{{{1}}}Valuation Time}}==== | ===={{{{{1}}}Valuation Time}}==== | ||
{{ | A bit of an evolution in the concept of the {{{{{1}}}Valuation Time}} between the OG and VM versions of the CSA. | ||
In the OG versions, the {{{{{1}}}Valuation Time}} defaulted to one of close of business on the {{{{{1}}}Valuation Date}} — which figures, intuitively, or close of business on the {{{{{1}}}|Local Business Day}} immediately before the {{{{{1}}}Valuation Date}} — which doesn’t, as a matter of cold semantic logic, but okay, the time by reference to which you calculate a value, does not have to be on the same day that you actually calculate it, as long as it has already happened. Fine. In fact, when you think about it the {{{{{1}}}Valuation Time}} being at the ''close of business'' on a {{{{{1}}}Valuation Date}} implies that the point in the day at which you are actually ''performing'' your valuation calculations is, well, ''after'' closing time: the bell has rung and everyone has started drifting home. That doesn’t really make a lot of sense either. But hey ho. | |||
In the VM CSAs, the Valuation Time is quite a lot looser. If you haven’t fiddled with it, the Valuation Time is the Valuation Agent’s normal time for calculating end-of-day valuations — which need not, therefore, be the actual end of the day — or any other commercially reasonable time “on the relevant day”. “Day”, not “date”, and not {{{{{1}}}Valuation Date}}, so it could still be the ''preceding'' day, but logically it doesn’t make a lot of sense (we think) to presume it could be ''afterward''. | |||
====“Base Currency Equivalent of bid price”==== | ====“Base Currency Equivalent of bid price”==== | ||
It is not unknown to amend limb (ii) to include | It is not unknown to amend limb (ii) to include “the {{{{{1}}}|Base Currency Equivalent}} of the bid price obtained by the {{{{{1}}}Valuation Agent}} ''multiplied by the nominal amount of such security''”. | ||
This is presumably to cater for the pedantic argument — just the sort of argument that a diligent [[legal eagle]] with nothing better to do loves to run — that a “[[bid price]]” could be a percentage figure of a nominal amount, instead of a cash value, and this might upset the calculation. I mean, really. | This is presumably to cater for the pedantic argument — just the sort of argument that a diligent [[legal eagle]] with nothing better to do loves to run — that a “[[bid price]]” could be a percentage figure of a nominal amount, instead of a cash value, and this might upset the calculation. I mean, really. | ||
But even if a “price” isn’t necessarily a [[cash]] amount — to be sure, trading folk ''do'' talk that way sometimes, even if most sensible working folk don’t — the idea of the “{{{{{1}}}|Base Currency Equivalent}}” of that price certainly turns it into one. You can’t exactly have “USD 86%”, can you? And if the {{{{{1}}}|Eligible Credit Support}} includes [[collateral]] other than [[cash]] or [[Debt security|debt instrument]]s (e.g., [[equities]]), reference to a nominal amount multiplier is potentially confusing. | But even if a “price” isn’t necessarily a [[cash]] amount — to be sure, trading folk ''do'' talk that way sometimes, even if most sensible working folk don’t — the idea of the “{{{{{1}}}|Base Currency Equivalent}}” of that price certainly turns it into one. You can’t exactly have “USD 86%”, can you? And if the {{{{{1}}}|Eligible Credit Support}} includes [[collateral]] other than [[cash]] or [[Debt security|debt instrument]]s (e.g., [[equities]]), reference to a nominal amount multiplier is potentially confusing. | ||