central-clearing

Learning Objectives: Identify examples of wrong-way collateral. Describe the various wrong-way modeling methods, including hazard rate approaches, structural approaches, parametric approaches, and jump approaches. Explain the implications of central clearing on wrong-way risk. Questions...

Learning Objectives: Compare bilateral and central clearing. Compare initial margin and default fund requirements for clearing members in relation to loss coverage, cost of clearing, and moral hazard. Describe the advantages and disadvantages of central clearing. 24.31.1. In the context of OTC...

Learning Objectives: Define a central counterparty (CCP) and describe the mechanics of central clearing. Explain the concept of novation under central clearing. Define netting, multilateral offset, and compression and provide examples of each. Describe the application and estimation of margin...

Learning Objectives: Describe central clearing of OTC derivatives and discuss the roles, mandate, advantages, and disadvantages of the central counterparty (CCP). Explain the margin requirements for both centrally-cleared and non-centrally-cleared derivatives. Define special purpose vehicles...

Learning objectives: Examine how the clearing of over-the-counter transactions through central counterparties has affected risks in the financial system. Assess whether central clearing has enhanced financial stability and reduced systemic risk. Describe the transformation of counterparty risk...

Learning objectives: Compare margin requirements in centrally cleared and bilateral markets, and explain how margin can mitigate risk. Compare and contrast bilateral markets to the use of novation and netting. Assess the impact of central clearing on the broader financial markets. Questions...

Learning objectives: Provide examples of the mechanics of a central counterparty (CCP). Describe advantages and disadvantages of central clearing of OTC derivatives. Questions: 603.1. Which is TRUE of clearing? a. By definition, clearing is central b. Clearing occurs between execution and...

Learning objectives: Explain the characteristics of bilateral OTC derivatives trading and the role they may have played in the recent financial crisis. Identify the regulatory changes implemented after the financial crisis. Describe the basic characteristics of central clearing and central...