Collateralized to market: Difference between revisions
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imported>Doug Williamson (Create page. Source: ISDA file:///C:/Users/Panasonic%202/Downloads/ISDA%20VM%20Settlement%20Whitepaper%20final%20.pdf) |
imported>Doug Williamson (Classify page.) |
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''Derivative instruments'' | ''Derivative instruments''. | ||
(CTM). | (CTM). | ||
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* [[Settled to market]] | * [[Settled to market]] | ||
* [[Variation margin]] | * [[Variation margin]] | ||
[[Category:Financial_products_and_markets]] | |||
Latest revision as of 19:15, 27 June 2022
Derivative instruments.
(CTM).
A collateralized to market (CTM) derivative instrument is one under which the 'losing' counterparty is required to make periodic margin payments, usually daily, of the amounts by which the instrument is 'out of the money' for them.
This mitigates counterparty credit risk for the 'winning' counterparty under the derivative contract.
