Credit support annex: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson m (Spacing and indentation) |
imported>Doug Williamson m (Split up long sentence into short ones.) |
||
| Line 1: | Line 1: | ||
(CSA). | (CSA). | ||
An agreement | An agreement designed to reduce counterparty credit risk in derivative transactions. | ||
The CSA requires the "losing" counterparty to post collateral for the amount by which they are currently losing. | |||
Expressed more formally, collateral is posted for the amount by which the related derivative instrument is out of the money for the losing counterparty. | |||
== See also == | == See also == | ||
Revision as of 12:45, 17 August 2013
(CSA).
An agreement designed to reduce counterparty credit risk in derivative transactions.
The CSA requires the "losing" counterparty to post collateral for the amount by which they are currently losing.
Expressed more formally, collateral is posted for the amount by which the related derivative instrument is out of the money for the losing counterparty.
