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Derivative Products include:

 Interest Rate Swaps & Options

Equity Swaps & Options

Credit Default Swaps

Volatility Swaps

The Changes promulgated under Dodd-Frank (Title VII – Derivatives):

Repricing products

Repriced using OIS Curve for posting of collateral and LIBOR for trading .  This is explained in detail here.

Clear the products:

Cleared Derivative: on a futures type exchange with initial & variation margin

Bilateral Derivatives: trades OTC but will still have initial margin and variation margin; differences with Cleared erivtives will be documentation and reporting of trades

Collateral

Creddit Valuation Adjustment (CVA)

F.K.A. the “add-on” to a swap rate to cover counterparty credit risk

Also relates to the CDS premium

Debt Valuation Adjustment (DVA)

more useful to corporations able to reprice debt.  Specifically if they’re losing money on their derivatives hedge, DVA will allow them to reprice their debt to show the “profit”.

At MHderivatives.com each of these issues is handled at the appropriate level for the participant:

LeveL 1:  Just the facts – what’s is it?  What does it mean?

Level 2:  Explains impact on how we will transact and what is the effect of derivatives reform on revenue – risk adjusted revenue.

Level 3:  Quantitative, complex strategy, follow up trading, money management stops, etc.

Custom:  Typically editorial but also indicates the topic with so many degrees of freedom that we invite readers to send in Pop questions” for instant answers.

 

Although information is available to most visitors, we reward our prospective clients as well as our current clients with more advanced information.

That information may include spreadsheets so you can practice pricing a product, case studies or an invitation to speak with a Subject Matter Expert.

 

NEW for 2016

As we enter Phase Two of Implementation and integration of Dodd Frank, MHDS wants to make sure you have all the resources necessary in one spot.

Look for many changes to the site going forward and if you have a specific need, please feel free to email us.

 

 

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