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Template:Isda 2(a)(iii) summ: Difference between revisions
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Amwelladmin (talk | contribs) (Created page with "===...These days?=== The overriding mischief that a flawed asset provision addresses arises when a solvent swap counterparty with a long-dated out-of-the-money portfol...") |
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Since all swap counterparties now must pay the cash value of their negative [[mark-to-market]] exposures every day, the very thing the flawed asset seeks to avoid — paying out negative positions — has happened, there is a lot more to be said for immediately closing out an {{isda}}, whether or not it is [[out-of-the-money]]. | Since all swap counterparties now must pay the cash value of their negative [[mark-to-market]] exposures every day, the very thing the flawed asset seeks to avoid — paying out negative positions — has happened, there is a lot more to be said for immediately closing out an {{isda}}, whether or not it is [[out-of-the-money]]. | ||
For [[synthetic prime brokerage]] fiends, there is another reason to be unbothered by Section 2(a)(iii): you shouldn’t ''have'' a losing position, since you are meant to be perfectly delta-hedged. Right? | |||
===Flawed assets generally=== | ===Flawed assets generally=== | ||
{{Flawed asset capsule}} | {{Flawed asset capsule}} | ||