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Template:M summ Equity Derivatives 12.7: Difference between revisions
Template:M summ Equity Derivatives 12.7 (view source)
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Accordingly, the dealer will be ''most'' unamused if a client asks it to consider an alternative price someone ''else'' has come up with to value its own hedge liquidation. This is like saying, to a football fan, “look, I know Crystal Palace lost to Scunthorpe in extra time at the weekend, but my mate is a football expert, and he says Palace were dead unlucky, hit the crossbar a couple of times, and that Scunthorpe goal should have been called off-side, so why don’t we call this 4:0 to Palace?” | Accordingly, the dealer will be ''most'' unamused if a client asks it to consider an alternative price someone ''else'' has come up with to value its own hedge liquidation. This is like saying, to a football fan, “look, I know Crystal Palace lost to Scunthorpe in extra time at the weekend, but my mate is a football expert, and he says Palace were dead unlucky, hit the crossbar a couple of times, and that Scunthorpe goal should have been called off-side, so why don’t we call this 4:0 to Palace?” | ||
The [[dealer]] will, tersely, say, | The [[dealer]] will, tersely, say, “I am sure you have a great relationship with [[Wickliffe Hampton]] and everything, but I could not care a row of buttons where ''they'' see the notional value of ''my'' hedge. ''They'' don’t have to sell it. ''I'' do. The price ''I'' see is X. Now, if your buddies at [[Wickliffe Hampton]] are prepared to make ''me'' a [[firm bid]] at Y to buy my actual hedge, from me, then I am listening. Otherwise, the price I see is X.” | ||
====But it is {{eqderivprov|Determining Party}}, not {{eqderivprov|Hedging Party}}==== | ====But it is {{eqderivprov|Determining Party}}, not {{eqderivprov|Hedging Party}}==== | ||