Which ones are considered as swaps and regulated by the CFTC?
Which ones are considered as swaps and regulated by the CFTC?
Under the Dodd-Frank Act, a TRS based on a broad-based security index would be a swap regulated by the CFTC. A TRS on two or more loans likewise would be a swap subject to CFTC regulation. Who regulates credit default swaps (CDS)? The SEC regulates CDS on single names, loans and narrow-based security indexes.
What is a Dodd-Frank swap?
The Dodd-Frank Act divides regulatory authority over swap agreements between the CFTC and SEC (though the prudential regulators, such as the Federal Reserve Board, also have an important role in setting capital and margin for swap entities that are banks).
What is a CFTC swap?
The CFTC adopted anti-evasion rules that define as swaps those transactions that are willfully structured to evade the requirements of the Dodd-Frank Act.
What is a major swap participant under Dodd-Frank?
Definition of “Major Swap Participant” (MSP) A person whose outstanding swaps create “substantial counterparty exposure that could have serious adverse effects on the financial stability of the United States banking system or financial markets.”
Is a forward contract a swap?
A forward contract is a contract that promises delivery of the underlying asset, at a specified future date of delivery, at an agreed upon price stated in the contract. A swap is a contract made between two parties that agree to swap cash flows on a date set in the future.
Which is a type of swap?
The generic types of swaps, in order of their quantitative importance, are: interest rate swaps, basis swaps, currency swaps, inflation swaps, credit default swaps, commodity swaps and equity swaps.
What is a swap entity?
Related Definitions Swap entity means a person that is registered with the Commission as a swap dealer or major swap participant pursuant to the Act.
What are swap trades?
A swap is an agreement for a financial exchange in which one of the two parties promises to make, with an established frequency, a series of payments, in exchange for receiving another set of payments from the other party. These flows normally respond to interest payments based on the nominal amount of the swap.
What is a swap participant?
A Major Swap Participant is a person or entity that maintains a substantial net position in swaps, exclusive of hedging for commercial risk, or whose positions creates such significant exposure to others that it requires monitoring.
What is swap explain?
Definition: Swap refers to an exchange of one financial instrument for another between the parties concerned. This exchange takes place at a predetermined time, as specified in the contract. Description: Swaps are not exchange oriented and are traded over the counter, usually the dealing are oriented through banks.
