\ Post Trade Glossary
| ACK: | Acknowledgment – c |
| AFME: | Association for Financial Markets in Europe |
| AI: | Artificial Intelligence |
| APA: | Automated Post-Trade Allocation. |
| API: | Application Programming Interface |
| ASI: | Automated Systems Interface |
| ASIC: | Australian Securities & Investments Commission |
| Affirmation: | Validation of the specifics of a financial transaction before sending it to settlement |
| Algorithm (Trading Algorithm): | A specific set of clearly defined instructions aimed to carry out a trade |
| Alpha: | A measure of an investor’s risk-adjusted return |
| Ambiguous Match: | An unidentifiable match between set of identical trades. These require the user to identify individual trade matches. This is a matching term used in both triReduce and triResolve. |
| Amortising swap: | Typically an interest rate swap where the notional (upon which the coupon payments are calculated) decreases during the life of the swap. A triReduce Rates eligible instrument type. |
| Asset Class: | OSTTRA supports all derivative asset classes, including Credit, Commodity, Equities, Interest Rate, and FX, and all product types, from plain vanilla trades to complex structures. |
| Assignment Date (or Step-in Date): | The date on which a party assumes ownership of a trade side. |
| Auction Date: | The date on which a party assumes ownership of a trade side. |
| B2B: | Back to Back |
| BaFin: | Bundesanstalt für Finanzdienstleistungsaufsicht, The German Federal Financial Supervisory Authority |
| BIS: | Bank for International Settlements |
| BL: | Business Logic |
| BOC: | Bank of Canada |
| BOE: | Bank of England |
| BOJ: | Bank of Japan |
| BaFin: | Bundesanstalt für Finanzdienstleistungsaufsicht, The German Federal Financial Supervisory Authority. |
| Basel Regulations: | International banking regulations first issued in 2004 which specifies minimum required size of capital reserves for banks. OSTTRA, via triReduce, can help banks reduce this required amount of capital reserves and thereby reduce the capital costs associated with trading. |
| Basis Risk: | A risk arising from a difference in trade economics on two, otherwise offsetting trades. |
| Benchmark Curve: | Ability to view and compare your own trade valuation to an industry average valuation curve for single name credit trades and standard indices. |
| Beta: | A measure of a security’s volatility relative to the market |
| Bid: | Is where a customer can sell to a liquidity provider |
| Big Figure: | The first three digits of which make up a currency listing |
| Bilateral Margining: | OSTTRA triResolve provides a comprehensive margin management service covering all aspects of the collateral management workflow. |
| BIS: | Bank for International Settlements. An international organization which fosters cooperation among central banks and other agencies in pursuit of monetary and financial stability. |
| Break: | Where the transaction details of a matched trade are different, triResolve will identify and facilitate tracking of such differences for swift resolution. |
| Business Day Convention: | The convention for adjustment of event dates relating to a financial transaction towards a valid business day. The most relevant conventions are: – Following: where the date is adjusted to the first following day that is a Business Day – Modified Following: the same as ‘Following’, unless the first following Business Day is in the next calendar month, in which case that date will be the first preceding day that is a Business Day – Preceding: where the date is adjusted to the first preceding date that is a Business Day |
| Buyer: | In OSTTRA triReduce Credit terms, this refers to the ‘Buyer’ of protection (or the ‘payer’ of interest payments). In triReduce Rates, this refers to the payer of the fixed leg. |
| CC: | Correlation Coefficient |
| CCP: | central clearing counterparty |
| CCY: | Currency |
| CDS: | Credit Default Swap |
| CEM: | Collateral and Exposure Management |
| CFTC: | U.S. Commodity Futures Trading Commission |
| CIG: | Credit Implementation Group. Reports into Credit Steering Committee. |
| CLOB: | Central Limit Order Book |
| CLS: | Continuous Linked Settlement |
| CME: | Chicago Mercantile Exchange |
| COG: | Conversational Gateway |
| COIG: | Commodities Implementation Group, under ISDA |
| COSC: | Commodities Steering Committee, under ISDA. |
| CPF: | Conversational Printer Feed |
| CSA: | Collateral Service Agreement, Credit Support Annex, a legal agreement between the two parties to an OTC derivative transaction which contains the agreed collateral terms under an ISDA Master Agreement, Canadian Securities Administrators. |
| CSC: | Credit Steering Committee, under ISDA |
| CSDR: | Central Securities Depositary Regulation |
| CSV: | Comma Separated Values |
| CVA: | Credit Valuation Adjustment. A common measure of counterparty credit risk. |
| Cash Flow: | A transfer of money, receiving money means positive cashflow while paying means negative cash flow. OSTTRA provides cashflow affirmation services. |
| Cash Tolerance: | A tolerance defining the maximum amount of cash to be paid or received in an Unwind Proposal. See Unwind Proposal. |
| Clearing: | the process of guaranteeing financial market transactions between. the execution of transaction and its settlement. |
| Close Match: | A close match is a mismatch on one or two fields of lesser importance. It is a matching term used in OSTTRA triReduce. |
| Collateral: | An asset posted to or by a counterparty to mitigate its counterparty credit risk. |
| Collateral Call: | The issuing of a demand for margin / collateral is sent to a counterparty following the calculation of the collateral requirement. |
| Collateral Dispute: | The process by which a counterpart disputes a collateral call. |
| Collateral in transit: | Collateral that is due to be sent or returned but has not yet settled. |
| Collateral Management: | A term referring to the processes used to manage collateral. |
| Compounding Swap: | A swap which compounds interest over more than one fixing period. |
| Compression: | OSTTRA’s TriOptima, through its triReduce service, offers market neutral compression of trades and gross notional. See also Multilateral Termination. |
| Confirmation: | A receipt of an execution which documents the commercial terms of the transaction |
| Convertible bond : | A debt security that can be converted into common stock/equity |
| Correlation: | A statistical measure of how two market instruments move in relation to one another. Positive correlation implies that both instruments move together. Negative correlation implies that both instruments move in the opposite direction to one another. |
| Correlation Coefficient: | A measure of the degree of linear relationship between two variables |
| Counterparty Credit Risk: | A risk arising from uncertainty in a counterpart’s ability to meet the obligations set out in a contract. |
| Counterparty exposure (for triReduce): | Net MtM per counterparty. TriOptima offers services to efficiently manage and reduce counterparty exposure. |
| Counterparty exposure (for triResolve): | OSTTRA’s triResolve allows subscribing parties to calculate their current exposure against each subscribing party at a group, entity portfolio or trade by trade level. |
| Counterparty Risk: | Risk arising from potential default and hence credit-worthiness of a counterparty. TriOptima offers services to efficiently manage and reduce counterparty risk. |
| Counterparty Risk Tolerance: | A tolerance used to constrain risk impact in counterparty relations. |
| CP Unmatched: | During linking in a triReduce cycle, this term is used for trades that are submitted by the counterparty, but not by the participant. |
| Credit Default Swap: | A contract entered into by a buyer and seller. The buyer purchases credit protection on a debt obligation from the seller. The buyer pays a regular premium for the privilege. |
| Credit Event: | An event relating to the deterioration in credit worthiness of an underlying entity to a credit derivative. |
| Credit Risk: | The risk that a counterparty will not settle an obligation for full value, either when due or any time thereafter |
| Credit Spread Delta Tolerance: | A tolerance defining the maximum acceptable impact on the Credit Spread Delta risk. |
| Cross Currency Basis Swap: | See Cross Currency Swap. |
| Cross Currency Swap: | A financial contract where the buyer and seller agrees to swap floating cash flows between two different currencies, during a defined period of time. See Cash Flow. |
| CSA-Collateral Balance Reconciliation: | OSTTRA triResolve facilitates reconciliation of collateral balances between counterparties to identify any non receipts or errors in the amount of collateral posted or received. |
| CSA-Exposure Reconciliation: | Reconciling trade population characteristics and valuations daily minimises misbookings and decreases the number of collateral disputes significantly, reducing credit and operational exposures. |
| D2C: | Dealer to Client |
| D2D: | Dealer to Dealer |
| DMA: | Direct Market Access |
| DSL: | Daily Settlement Limit |
| DTCC: | Depository Trust & Clearing Corporation. OSTTRA provides is interoperability with the DTCC for automated terminations and also provides OSTTRA triReduce Credit participants with TIW extracts relating to cycles. |
| DTF: | Deal Tracker Feed, |
| DV01: | A commonly used term for a measure of risk and stands for the Dollar Value of a one unit change in the underlying. It is used across a number of different asset classes |
| DvP: | Delivery vs Payment |
| Data Summary: | OSTTRA provides functionality to display post-trade data on different levels of detail where it can be grouped and compared based on user criteria. |
| Delivery Point: | Commodity market terminology for the physical delivery location relating to a transaction. An example for US Natural Gas is Henry Hub. |
| Derivatives: | a type of financial instrument or contract whose value is derived from the performance of an underlying asset |
| Discount Delta: | The sensitivity to a change in the rate used to discount future cash flows. |
| Dispute Resolution: | OSTTRA triResolve incorporates a stream lined work flow for Dispute Resolution, the recommended ISDA procedure for resolving complex disputes. |
| Distant Match: | A distant match is a mismatch on trade details that could have a major economic impact. It is a matching term used in OSTTRA triReduce. |
| Document Type: | A legal confirmation document clause type. Typically refers to the settlement conditions for Credit Derivatives. |
| Dress Rehearsal: | Dress Rehearsal. This phase of an OSTTRA triReduce cycle provides participants with a test proposal giving them an indication of the risk movements they can expect to see in Live Execution. |
| EB: | Executing / Electronic Broker |
| ECB: | European Central Bank |
| ECN: | Electronic Communication Network |
| EDD: | see Event Determination Date. |
| EEPE: | Effective Expected Positive Exposure. |
| EFET: | The European Federation of Energy Traders. A group of more than 90 energy trading companies dedicated to stimulate and promote energy trading throughout Europe. |
| EFP: | Exchange for Physical |
| EFR: | Exchange for Risk |
| EFRP: | Exchange for Related Position |
| EMIR: | European Market Infrastructure Regulation |
| EMIR : | European Market Infrastructure Regulation |
| EMS: | Execution Management System |
| EONIA: | Euro Overnight Index Average |
| EOO: | Exchange of Options for Options |
| ESMA: | European Securities and Markets Authority |
| ETD: | Exchange Traded Derivatives |
| ETF: | Exchange Traded Funds |
| ETP: | Electronic Trading Platforms |
| EUREX: | European derivatives exchange |
| EURIBOR: | Euro Interbank Offered Rate |
| EuroSTR: | Euro short-term rate |
| Energy Swap: | An exchange of payments relating to an energy commodity. |
| Enrichment: | The process of adding or changing relevant information of a trade to satisfy the requirements to book and settle a transaction |
| Event Determination Date: | For Credit Derivatives, it relates to the date on which the Credit Event Notice is ‘served’. |
| Exchange Traded Contract: | A transaction that takes place on an exchange trading platform where buyers may meet sellers anonymously. |
| Extraterritoriality: | The right or privilege of a state to exercise authority in certain circumstances beyond the limits of its territory. |
| FASB: | Financial Accounting Standards Board |
| FCA: | The Financial Conduct Authority (FCA). The regulator of the financial services industry in the UK. |
| FCM: | Futures Commission Merchant |
| FED: | Federal Reserve |
| FIA: | Futures Industry Association |
| FIX: | Financial Information Exchange protocol |
| FMI: | Financial Market Infrastructure |
| FMIA : | Financial Markets Infrastructure Act, also known as ‘FinfraG’ |
| Forex: | Foreign Exchange |
| FPML: | Financial Products Markup Language |
| FRA: | Forward Rate Agreement |
| FRTB: | Fundamental Review of the Trading Book |
| FSB: | Financial Stability Board. Established to coordinate the work of national financial authorities and international standard setting bodies, at the international level |
| FSS: | Financial Supervisory Service (South Korea) |
| FX: | Foreign Exchange |
| FXO: | FX options |
| Financial Derivative: | A financial contract where the value/pay off is strictly dependent on an underlying asset. |
| Fixing: | For an Interest Rate Swap, a fixing is the float rate for the current/next coupon period. |
| Fixing Date: | This is the day and time whereby the comparison between the NDF rate and the prevailing spot rate is made |
| Forex Swap: | See FX Swap. |
| Forward: | A non-standardized, and typically over-the-counter contract, obligating obligation the owner to either buy or sell an underlying financial instrument at a pre-determined time in the future and at a pre-determined price. |
| Forward Rate Agreement: | An agreement to fix a rate of return for a period of time commencing in the future. |
| Full Termination: | A trade that is struck off from a portfolio as part of a triReduce unwind proposal. |
| Funding Risk: | Relates closely to Interest Rate Risk, but deals specifically with the method of handling capital in- and out-flows. |
| Futures Contract: | A standardized and exchange traded contract obligating the owner to either buy or sell an underlying financial instrument at a pre-determined time in the future and at a pre-determined price. |
| FX Forward: | An agreement to buy or sell currency in the future and at a pre-determined price. |
| FX Spot: | Buying or selling currency at the current market rate under regular market settlement conditions. |
| FX Swap: | An FX Forward with an additional reverse FX spot trade upfront. |
| GMRA: | Global Master Repurchase Agreement |
| G14 dealers: | Group of 14 international banks that have signed up to meet the NY Fed’s regulatory commitments. |
| Global Master Repurchase Agreement: | a model legal agreement designed for parties transacting repos, published by the ICMA |
| HFT: | High Frequency Trading |
| HKMA : | Hong Kong Monetary Authority |
| HTML: | Hypertext Markup language |
| Haircut: | The amount by which the market value of the collateral is reduced to account for price volatility and liquidity. Also known as the valuation percentage. |
| Hedging: | A risk management or trading technique where fluctuations in profit or loss are limited or minimised. Hedging can be achieved by taking opposing positions in two positively correlated instruments. |
| Hub: | A feature of the OSTTRA triReduce Credit service allowing participants to group multiple books together, thereby achieving greater termination efficiency. |
| IAS: | International Accounting Standards. |
| IBOR: | Interbank Offered Rates |
| IBOR: | Investment Book of Record |
| ICE: | The Intercontinental Exchange |
| ICMA: | International Capital Market Association |
| IIGC: | ISDA Industry Governance Committee. |
| IM: | Initial Margin |
| IOSCO: | International Organization of Securities Commissions. |
| IP: | Internet Protocol |
| IR: | Interest Rates |
| IRS: | Interest Rate Swap |
| ISDA: | International Swaps and Derivatives Association |
| ISDA CIWG: | ISDA’s Collateral Infrastructure Working Group. |
| ISO: | International Organization for Standardization |
| IMM dates: | In terms of credit derivatives, International Monetary Market (IMM) dates are the four quarterly maturity dates: 20th March, 20th June, 20th September and 20th December. In terms of futures and options and swaps, IMM dates are four quarterly maturity dates: the third Wednesday in March, June, September and December. |
| Independent amounts: | The amount of collateral required over and above the mark to market of a portfolio. It is designed to cater for changes in the market value of a portfolio between margin calls. |
| Interbank: | Transactions conducted between or involving two or more banks |
| Interest Rate Delta: | Sensitivity of the value of a trade to a related interest rate. It may be expressed as a profit or loss measured by a single unit uptick in the interest rate from a valuation curve. A popular measure of interest rate risk, commonly known as price value of a basis point (PV01) or dollar value of a basis point (DV01). |
| Interest Rate Delta Tolerance: | A tolerance defining the maximum acceptable impact on Interest Rate Delta risk. |
| Interest Rate Swap: | In its basic form, a commitment to exchange of fixed interest payments and floating (variable) interest payments in the future. |
| ISDA Minimum Market Standards: | ISDA has published a set of minimum field requirements for collateralised portfolio reconciliation. |
| ISDA’s Best Practices for the OTC Derivatives Collateral Process: | ISDA best practices document for the collateral management process following the “Roadmap for Collateral Management”, an action plan to re-examine the collateral management function based on the market events of 2008. |
| ISDA’s Port Reconciliation Best Practices: | OSTTRA triResolve supports ISDA’s recommendations for portfolio reconciliation. |
| JFSA: | Japan Financial Services Agency |
| JMS: | Java Message Service |
| KVA: | Capital Valuation Adjustment |
| LA: | Liquidity Aggregator |
| LCH: | London Clearing House |
| LIBOR: | London interbank offered rate |
| LME: | London Metal Exchange |
| LP: | Liquidity Provider |
| LSEG : | London Stock Exchange Group |
| Linking : | The first phase of an OSTTRA triReduce cycle, where participants submit trades that are eligible for termination. OSTTRA, thought the TriOptima entity forms a legal connection between trade sides that form a deal previously incepted between two institutions. |
| Liquidity: | How active a market is or how easily a market can absorb and match orders |
| Liquidity Risk: | A risk arising from a lack of tradable volume in a market. |
| Long: | When you have bought an underlying financial product on the expectation that the price will rise or increase over time |
| MAPI: | Messaging Application Programming Interface |
| MAS: | Monetary Authority of Singapore |
| MDP: | Multi Dealer Platform |
| MIFID: | Markets in Financial Instruments Directive |
| MIFR: | Markets in Financial Instruments Regulation |
| MIS: | Management Information System |
| MQ: | Message Queue |
| MTF: | Multilateral Trading Facility |
| MTM: | Mark-to-Market |
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| Margin Call: | Margin calls can be issued to a counterparty via the triResolve web site using the Margin Management application. |
| Margin Management: | Margin management represents the comparison and collateralisation of the daily valuation changes in a portfolio of financial transactions outstanding between two counterparts. OSTTRA triResolve’s Margin management functionality facilitates this process by providing transparency and a secure communication platform where clients can manage both incoming and outgoing margin calls in an efficient manner with full audit trails. triResolve provides early visibility of potential problems, providing maximum time to investigate and solve them while allowing users to quickly process straightforward margin actions. |
| MarkitWire: | An electronic trade capture and confirmation platform tat is part of OSTTRA. OSTTRA triReduce Rates is interoperable with OSTTRA MarkitWire for trade terminations. |
| Mark-to-Market: | Method used to value an asset, such as stocks or shares, based on the current market price. Also: The net present value of a derivative trade. Typically calculated using the concept of cash flow discounting. |
| Mark-to-Market Tolerance: | A tolerance used to constrain the amount of Mark-to-Market realized in an Unwind Proposal. |
| Match Quality: | OSTTRA triResolve provides a match quality rating via the use of stars. A 5-star rating is a perfect match while a 1-star rating represents a match with three major differences or more. |
| Match Status: | When a match result is published in triResolve users can review established matches and each match is assigned a status. |
| Matched Trades: | A match where all key data fields match or where insignificant discrepancies have been identified. |
| Matched with Difference: | OSTTRA triResolve will identify trades that closely correspond to an equivalent trade in your counterparty’s portfolio but one or several key data fields do not match. |
| Matching: | The process of comparing the two sides of a trade to ensure financial details agree BUY and SELL requirements to satisfy the booking and settlement of a trade |
| Mine: | Buying underlying Product or Service |
| Minimum transfer amount: | A minimum size threshold below which calls for collateral will not be made. |
| MIS Reporting: | The triResolve service includes highly flexible reporting that can be customized to fit a wide range of purposes and departments within a firm. |
| Monthly Regulatory Metrics: | OSTTRA, via its TriOptima entity, is the producer of the G14 dealer portfolio reconciliation metrics that are provided to the regulators and Federal Reserve each month. |
| Multilateral Termination: | A trade tear-up exercise (or compression process) involving more than two parties. TriOptima offer a multilateral-termination service, triReduce. |
| NAK: | Negative Acknowledgment |
| NBLP: | Non Bank Liquidity Provider |
| NCM: | Non Clearing Member |
| NDF: | Non-Deliverable Forward |
| NDO: | Non-Deliverable FX option |
| NDS: | Non-Deliverable Swap |
| NFP: | Non Farm Payroll |
| NMS: | Network Messaging System |
| NoE: | Notice of execution |
| NOP: | Net Open Position |
| Nominal Tolerance: | A tolerance used to constrain the amount of Notional maturing on specific end dates; used in triReduce Credit. |
| Non-collateralised trades: | Trades between two institutions that are not governed by the terms of a CSA. |
| Non-Subscriber Upload: | Extension to the triResolve service, which allows non-subscribing firms to submit their portfolios to triResolve for secure and automated reconciliation with their counterparties. |
| Notional: | The principal amount on a derivative contract. The amount is used a reference upon which interest is calculated. |
| Notional Amount: | Face Value of a trade which is agreed by 2 counterparties |
| Notional Revision: | A notional amendment of an existing trade as part of a triReduce unwind proposal. A Notional Revision can increase or decrease the notional on a given trade. |
| OBFR: | Overnight Bank Funding Rate |
| ODBC: | Open Database Connectivity |
| ODSG: | OTC Derivatives Supervisors Group. The group is chaired by the New York Fed and meets annually with other supervisors as well as major OTC Derivative market. |
| OIS: | Overnight Index Swap |
| OMS: | Order Management System |
| OSC: | Operations Steering Committee. Replaced the Operations Management Group (OMG) in 2009. |
| OSTTRA: | The centre of post-trade: pOSTTRAde |
| OTC: | Over the Counter |
| OTF: | Organised Trading Facilities |
| OFFER: | Is where a customer can buy from a liquidity provider |
| Operational Risk: | A risk which arises from a company’s people, system or processes. OSTTRA can, through its automation of post-trade processes, reduce the amount of manual steps required resulting in less operational risk. |
| Optimisation: | A mathematical technique for determining the extreme value of a function of several variables subject to a set of constraints. |
| OTC Derivative: | A derivative transaction taking place between two parties without the involvement of an exchange to facilitate the trade (“Over the Counter”). |
| Outright: | A forward currency or Fwd Outright contract with a locked-in exchange rate and delivery date allows a bank to buy or sell a currency on a specific date or within a range of dates |
| Overnight Index Swap: | An Interest Rate Swap that resets its floating leg one-day interest rate on a daily basis. The floating leg compounds and pays its cash flow in line with the fixed rate payment frequency. |
| PB: | Prime Broker |
| PBC: | Prime Broker Client |
| PCM: | Primary Clearing Member |
| PDF: | Portable Document Format |
| PFE: | Potential Future Exposure. A measure of the maximum credit exposure expected over a specific period of time. |
| PIP: | Price in percentage or Price Interest point. Represents the smallest value of change within a currency pair. |
| PM: | Precious Metals |
| PMS: | Portfolio Management System |
| PTF: | Principal trading firm |
| PTI: | Post-Trade Infrastructure |
| Partial Termination: | A notional reduction of an existing trade as part of a triReduce unwind proposal. |
| Payer: | The party to a trade that is required be the fixed interest rate payer in a derivative transaction. Typically, the Buyer. |
| Plain Vanilla: | The most basic form of a financial derivative contract. |
| Portfolio Compression: | OSTTRA triReduce service offers portfolio compression on OTC Derivatives. |
| Portfolio Reconciliation: | Portfolio reconciliation is a process of mutual trade and records comparison. It is a key process to manage and reduce operational risks. Proactive reconciliations of portfolios ensure high integrity in trade bookings as well as valuations. With a secure and automated trade upload, OSTTRA triResolve effectively matches even complex structures using sophisticated business logic. The result is presented in a common, online view for timely resolution of discrepancies and disputes. |
| Post-Trade: | A term used in the investment industry to refer to activities that take place after a trade has been executed. It includes activities such as clearing, settlement, and reporting. |
| Principal “Herstatt” Risk (Settlement Risk): | A type of credit risk. The risk that one counterparty of a two-way transaction could pay the sold currency without receiving the bought currency |
| Product Class: | OSTTRA supports all OTC derivatives across all asset and product classes, from plain vanilla to bespoke products. See Asset Class. |
| QD: | Quantile Decile |
| Quantile Decile: | A measure of variability in a data set |
| Quantity: | Used in triReduce Commodities to denote the contract size. |
| RA: | Retail Aggregator |
| RAR: | Risk-Adjusted Return |
| RBA: | Reserve Bank of Australia |
| RBNZ: | Reserve Bank of New Zealand |
| RFQ: | Request for Quote |
| RFS: | Request for Stream |
| RGUP: | Reverse Giveup |
| RIG: | Rates Implementation Group. Reports into Rates Steering Committee |
| RMO: | Recognised Market Operators |
| RSC: | Rates Steering Committee, under ISDA |
| RTNS: | Reuters Trade Notification Service |
| Receiver: | The party to a trade that receives the fixed rate of interest in a derivative transaction. Typically, the Seller. |
| Reconciliation History: | Ability to view past reconciliation results and the reconciliation progress over time. |
| Relative Difference: | OSTTRA triResolve offers extensive MtM value analysis such as comparison in absolute as well as relative terms to highlight problematic areas. |
| Replacement Risk: | The risk that a counterparty to an outstanding transaction for completion at a future date will fail to perform on the settlement date. This failure may leave its counterparty with an unhedged position or open market position. The resulting exposure is the cost of replacing, at current market prices , the original transaction |
| Replacement Trade: | A trade, delivered as part of a triReduce Credit unwind proposal. The sole purpose of this trade type is to rebalance risk that would be shifted by solely booking terminations. |
| Reset Risk: | The risk arising from floating interest rates being fixed (known as ‘resetting’) for their next coupon period. See Fixing. |
| Restructuring: | An agreement between an entity and its creditors to rearrange its liabilities. Often used as a preferred alternative to bankruptcy or liquidation. Can be considered as a Credit Event in some types of Credit Derivative. |
| Risk-Adjusted Return: | A measure of the return on an investment adjusted for the risk taken |
| Roll Date: | Pertaining to a derivative trade, the date on which one coupon is paid and the next coupon period begins. For CDS Indices, it can also refer to the launch date of a new series. |
| Root Cause Analysis: | In order to identify and categorize causes for common errors or misbookings triResolve provides extensive functionality for identifying and analyzing root causes. |
| Routing : | The process of sending a trade message from a publisher to a defined destination or receiver |
| RWA: | Risk Weighted Assets. The basis for calculating the minimum required capital reserve required for a bank. OSTTRA, through its triReduce termination service , can help banks reduce the required capital reserve and capital costs. See Basel Regulations. |
| SACCR: | Standardized Approach for Counterparty Credit Risk |
| SDP: | Single Dealer Platform |
| SEC: | U.S. Securities and Exchange Commission |
| SEF: | Swap Execution Facility |
| SFT: | Securities Financing Transaction |
| SMTP: | Simple Mail Transfer Protocol |
| SNB: | Swiss National Bank |
| SOFR: | Secured Overnight Financing Rate |
| SONIA: | Sterling Overnight Index Average |
| SPAN: | Standard Portfolio Analysis of Risk |
| SQL: | Structured Query Language |
| SSS: | Securities settlement system |
| STP: | Straight-Through Processing |
| SWIFT: | Society for Worldwide Interbank Financial Telecommunications |
| Securities-Financing Reconciliation: | OSTTRA triResolve has the functionality to reconcile a very wide range of different financial products, including Repos and Stock Borrow / Lend, Collateral Balances or trades not under CSA agreement. |
| Seller: | In Credit terms, this refers to the ‘Seller’ of protection (or the ‘receiver’ of interest payments). |
| Settlement Date: | The date upon which flows of cash and/or securities are exchanged following a financial transaction. |
| Settlement Risk: | See Principal “Herstatt” Risk |
| Short: | When you have sold an underlying financial product on the expectation that the price will fall or decrease over time |
| Softs: | Soft commodities – Items that are grown rather than mined |
| Spot: | the spot market term is taken from spot value, which is always 2 working days from the date the deal takes place. This two days gives the back office staff time to move the sums traded from one bank to another |
| Spot Rate: | The rate that can be achieved in the cash market (otherwise known as the spot market) under regular settlement conditions. |
| Spread: | The difference between the BID and OFFER prices |
| Square / Flat: | when you have no open positions in the market and so no risk of making a profit or loss |
| Star Colouring: | OSTTRA triResolve distinguishes between a manually created and an automatic match. The star rating will be in green for a manually created match and gold if the match is automatically created. |
| Step-in Date (or Assignment Date): | The date on which a party assumes ownership of a trade side. |
| Swap: | A simultaneous purchase and sale of identical amounts of one currency for another with two different value dates |
| Swapswire ID/Markitwire ID: | OSTTRA-owned and operated atching platforms that are interoperable with OSTTRA triResolve to facilitate investigation of cross related data and highlights any such discrepancies. |
| Systemic Risk: | The risk that the failure of one participant in a financial system to meet its required obligations will cause other financial institutions to be unable to meet their obligations when due |
| TARGET: | The Trans-European Automated Real-Time Gross Settlement Express Transfer System |
| TCA: | Transaction Cost Analysis |
| TCP: | Transmission Control Protocol |
| TOF: | Ticket Output Feed. A STP protocol |
| TONA: | Tokyo Overnight Average Rate |
| Securities-Financing Reconciliation: | OSTTRA triResolve has the functionality to reconcile a very wide range of different | Termination Date: | The day on which a trade termination becomes effective. | Three-Way Reconciliation: | Reconciliation of trades from three different sources; for example the principal, its counterparty and a custodian. | Tolerance: | Tool to constrain the magnitude of impact due from an Unwind Proposal. See Unwind Proposal for more info. | Trade Browser: | A highly flexible customizable filtering within OSTTRA triResolve that includes across entire portfolios on a trade detail level to break out sub-sets of trades for detailed analysis. | Trade Cart: | A temporary storage area for trades and or matches. | Trade Comments: | As a community platform, triResolve supports different types of client communication on the platform to facilitate the resolution process. | Traiana: | The Traiana global cross-asset network, which connects market participants to an established suite of post-trade processing, workflow and credit risk services, is part of OSTTRA’s suite of services. | Transaction Cost Analysis: | Used to calculate the efficacy of their portfolio transactions with the aim of analysing and lowering trading costs. | triBalance: | The systemic risk reduction service operated by OSTTRA through its entity TriOptima AB. | triReduce: | A multilateral portfolio compression and early termination service operated by OSTTRA through its entity TriOptima AB. | triResolve: | The proactive portfolio reconciliation service and exposure management service from OSTTRA, delivered through its legal entity TriOptima AB. | triResolve MatchID: | An OSTTRA service that delivers global unique match identifiers for each match established on the service. |
| UMR: | Uncleared Margin Rules |
| USLO: | US Listed options |
| Underlying: | An asset , index or rate from which the value, cash flows or deliverables under a derivative transaction are calculated. |
| Unilateral Reconciliation: | The vast majority of reconciliations are performed between subscribers to the service. triResolve also supports so called unilateral reconciliations, where the subscriber uploads data on behalf of the counterparty after receiving the counterparty’s consent. |
| Unmatched Trades: | Trades submitted by a party that are not submitted by their counterpart. OSTTRA triResolve will quickly identify any trades where a satisfactory match has not been identified, these are a single sided match where no matching counterpart trade has been identified. |
| Unwind: | Where both parties to a trade mutually agree to settle or terminate prior to the normal maturity of the trade, normally involving a cash settlement. |
| Unwind Proposal: | A proposal containing a package of transactions to carry out, that will have the effect of trade reduction and/or notional reduction. |
| Upfront Fee: | A fee paid typically on a credit derivative transaction, where the amount relates to a differential between the fair coupon and the fixed coupon on the trade. This results from product standardization in the credit derivative markets. |
| VB: | Voice Broker |
| VIT: | Vendor Initiated Terminations |
| VM: | Variation Margin |
| VNS: | Variable Notional Swap |
| Value Date: | The date upon which a cash payment relating to a financial transaction is completed. |
| Volatility: | The degree of change in a security’s price over time |
| WTI: | West Texas Intermediary |
| Write-down: | The process of diminishing the recorded value of a security to better reflect its lower market value. |
| XML: | Extensible Markup Language |
| XSLT: | Extensible Stylesheet Language Transformations |
| XVA: | Expected Valuation Adjustment |
| Yearly Coupon: | Aggregate amount of coupon to be paid or received during a year, for a contract. |
| Yearly Coupon Tolerance: | A tolerance specifying the maximum amount of Yearly Coupon to be shifted in an Unwind Proposal; used in triReduce Credit. |
| Yours: | Selling underlying product or service. |
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