Learning Curve

This Learning Curve examines why central counterparties might consider permitting issuers of bonds to write credit default swaps on themselves.

U.S. legislators are looking at how they might change the financial regulatory structure in the future, including possibly streamlining the regulation of over-the-counter derivatives to one entity.

This Learning Curve examines different variance swaps and how they can be used to manage volatility exposure.

After so many highly-rated structured products and other financial investments were drastically marked down following the sub-prime crisis and the ensuing credit crunch, CRAs and their ratings methodologies and practices have come under intense scrutiny.

In last week's issue, we explained what triangular set off accomplishes and why dealers need it, and presented the question of whether, after the SemCrude decision, a triangular setoff provision in a safe harbor contract is enforceable against a U.S. Bankruptcy Code debtor.

Almost every ISDA Master Agreement entered into between derivatives counterparties includes some type of setoff provision.

On March 16, the National Association of Financial Market Institutional Investors (NAFMII) published the 2009 version of the China Inter-bank Market Financial Derivative Transactions Master Agreement (the 2009 NAFMII Agreement).

This article highlights the importance of tail identification within a multi-dimensional setting, with a view to the wider problem of contagion modelling.

During the past few years, the exponential growth in the market for over-the-counter (OTC) derivatives and structured products has expanded investment opportunities available for asset managers.

Despite the recent upheaval in the financial markets, derivatives continue to play an important role in institutional investment strategies.

Despite ongoing regulatory focus, the vast majority of trade confirmations in the over-the-counter equity derivatives market are processed via paper.

In recent times, the over-the-counter derivatives markets have been hit by ratings downgrades, net asset value and performance declines, defaults, collateral calls and close-outs, and market participants have struggled to assess the implications.