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Template:M summ Equity Derivatives 12.1(a): Difference between revisions
Template:M summ Equity Derivatives 12.1(a) (view source)
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Break these Extraordinary Events into four categories: | {{extraordinary events capsule}}Break these '''“{{eqderivprov|Extraordinary Events}}”''' into four categories: | ||
*'''[[Corporate action]] thingies''': (generally) benign but unscheduled matters of corporate structure concerning the management of specific underlying {{eqderivprov|Shares}}, that change the economic proposition represented by those {{eqderivprov|Shares}}, and not the [[equity derivative]] contract. So: {{eqderivprov|Merger}}s, {{eqderivprov|Tender Offer}}s; | *'''[[Corporate action]] thingies''': (generally) benign but unscheduled matters of corporate structure concerning the management of specific underlying {{eqderivprov|Shares}}, that change the economic proposition represented by those {{eqderivprov|Shares}}, and not the [[equity derivative]] contract. So: {{eqderivprov|Merger}}s, {{eqderivprov|Tender Offer}}s; | ||
*'''[[Index Adjustment Event - Equity Derivatives Provision|Index adjustments]]''': Equivalent measures that relate to an underlying {{eqderivprov|Index}} - collectively {{eqderivprov|Index Adjustment Events}}. So: | *'''[[Index Adjustment Event - Equity Derivatives Provision|Index adjustments]]''': Equivalent measures that relate to an underlying {{eqderivprov|Index}} - collectively {{eqderivprov|Index Adjustment Events}}. So: | ||
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:*'''{{eqderivprov|Index Disruption}}''': disruption in the calculation and publication of {{eqderivprov|Index}} values; | :*'''{{eqderivprov|Index Disruption}}''': disruption in the calculation and publication of {{eqderivprov|Index}} values; | ||
*'''Negative ''external'' events relating to underlying {{eqderivprov|Issuer}}s''': {{eqderivprov|Nationalization}}s, {{eqderivprov|Insolvency}}, {{eqderivprov|Delisting}} of underlying {{eqderivprov|Issuer}}s; | *'''Negative ''external'' events relating to underlying {{eqderivprov|Issuer}}s''': {{eqderivprov|Nationalization}}s, {{eqderivprov|Insolvency}}, {{eqderivprov|Delisting}} of underlying {{eqderivprov|Issuer}}s; | ||
*'''Matters impeding the parties in performing and hedging the Transaction''': These oftebn do have some crossover with the events above, but the emphasis here is (for the most part) on their direct impact on the parties’ respective abilities to perform and risk manage the Transaction. So, the Triple Cocktail of Chain in Law, Hedging Disruption and Increased Cost of Hedging; the specific issues relating to short-selling (Loss of Stock Borrow and Increased Cost of Stock Borrow) and then two random ones that don’t brilliantly fit with this theory, but which people tend to disapply — possibly for this exact reason, but possibly because they are largely covered by the Triple Cocktail anyway — namely {{eqderivprov|Failure to Deliver}} and, even more weirdly, {{eqderivprov|Insolvency Filing}}. <br> | |||