Please send your inquiries and requests for firm prices to:
derivatives@shaw.ca or creditenhancement@shaw.ca
PUT OPTIONS ON STOCK INDEXES: Prices area now being updated.........
Political Risk
Credit Pricing
Central Inquiry Processing:
3080 River Road, Richmond, BC, Canada V7C 5N2
Asian CDS inquiries will be routed to India or Hong Kong
Will The Counterparty-Systemic-Risk Relationship Undermine Banks?
Price-makers seeking above-average profits in the OTC derivatives marketplace invariably find themselves entering arenas which defy consensus risk assessments: thinly traded foreign currencies, extended contract maturities, non-existent benchmark instruments, variable contractual terms, multi-jurisdictional exposure and diverse counterparties. One component of risk in OTC trades lies in fluctuating at-liquidation prices. But it is the second component, broadly termed “counterparty risk”, which continues to defy quantification.
Price-related risks on bank balance sheets are disclosed on the basis of fair value measurements (SFAS-157). But counterparty risk assessments are rarely debated. “This is a slippery slope involving any number of local and foreign participants, the overwhelming majority of whom are unrated,” a Wall Street treasury head recently conceded to the writer. “The more you dig into counterparty risk, the more you stray into the bizarre arena of systemic risk.” Bizzare?
Enter Email for Regular Updates
