Use of Derivatives. The Sub-Adviser may buy, sell or engage in transactions involving derivatives and other notional contracts (collectively, “Derivatives”), whether or not traded on any exchange or contract market, in managing the Fund in accordance with the Fund’s Registration Statement, other public filings with the SEC and the Fund’s investment guidelines. The Manager agrees that in that connection the Sub-Adviser, on the Fund’s behalf, and on such terms as the Sub-Adviser deems appropriate, may take any and all actions, or omit to take such actions, as it may in its discretion consider appropriate, including, but not limited to, selecting counterparties, executing brokers, clearing brokers and clearinghouses, as appropriate, negotiating and entering into agreements and arrangements governing or related to Derivatives (including without limitation ISDA Master Agreements and Credit Support Annexes and other master agreements or documents, confirmations and master confirmations, clearing documentation and agreements, and account opening and trading agreements), making representations and warranties, and generally taking steps intended to facilitate the entry into, trading, settling, margining and close out of Derivatives on the Fund’s behalf. Further, the Sub-Adviser may, acting as agent on the Fund’s behalf, instruct the Fund’s custodian to provide collateral and margin in respect of Derivatives entered into for the Fund, including but not limited to initial and variation margin (whether or not the counterparty agrees to provide collateral or margin to or for the benefit of the Fund) and may instruct the Fund’s custodian to deliver margin to and deposit collateral and margin with the counterparty (or a person acting on the counterparty’s behalf). All Derivatives entered into for the Fund by the Sub-Adviser will be entered into by the Sub-Adviser in the Fund’s name or in the Sub-Adviser’s name on behalf of the Fund, and the Sub-Adviser is authorized to reveal the name of the Fund as it may in its discretion consider necessary or appropriate in connection with transactions in Derivatives for the Fund. The Manager confirms that any limitations on the authority of the Sub-Adviser on behalf of the Fund to enter into transactions involving Derivatives, to negotiate, execute and deliver agreements or other documentation with respect thereto, or to perform any of the activities on behalf of the Fund of a nature described above will be provided to the Sub-Adviser in writing or are ...
Use of Derivatives. The use of derivatives is an integral part of the relatively low risk styles that use arbitrage and which typically aim for an absolute return with low levels of volatility. It is pre- cisely through the use of derivatives as a risk management tool that fund managers are able to isolate and hedge away unwanted risks, thus enabling perfect capture of the identified inefficiency between two related Securities. In effect, a manager uses derivatives rather like a type of insurance to protect individual transactions from specific market dynamics such as interest rates, credit risk and equity market risk, depending upon the exact nature of the inefficiency that the investment style seeks to capture. The manager has to exercise skill in terms of isolating the risks and judging to what extent they should be hedged out of a transaction. A prudent fund manager will assess the appropriate balance between risk and return depend- ing upon market conditions and the degree of volatility expected. On occasions during severe market shocks, the stress level that individual transactions are designed to withstand may be exceeded, resulting in unanticipated losses. Owing to the asymmetrical risk profile of derivative transactions relative to the underlying investments over which they are written, combined with the use of leverage, the degree of loss can be much greater than that associ- ated with the underlying investment. As a result, this can give rise to negative “outliers” as described under the heading “Downside risk” in paragraph 15.11. below.
Use of Derivatives. The use of derivative transactions should further one or more of the following objectives: • Lower the cost of capital, reducing the fixed or variable rate of interest payable by the State versus its cash market equivalent; • Manage current interest rate risk; • Hedge future interest rate risk; • Optimize the State's capital structure and risk profile; • Improve the State's financial flexibility; • Create a structure otherwise not available in the cash market; • Manage the State’s exposure to the risk of changes in the legal and regulatory treatment of tax- exempt bonds. The use of derivatives is not permitted for the following purposes, among others, which are inconsistent with the overall purposes and objectives of this Policy: • When they would constitute a speculative transaction or create significant leverage; • When the fair market value of the transaction cannot be readily and reliably determined; • When the transaction structure and terms result in a lack of liquidity that would compromise the State's ability to terminate the transaction; • If the notional amount of the swap exceeds the total amount outstanding of the underlying general obligation debt; • If the term of the swap agreement between the State and qualified counterparties extends beyond the final maturity date of the underlying debt.
Use of Derivatives. Derivatives are not allowed for retail clients. The Portfolio Manager may use derivatives in the portfolio of retail clients, i.e. in the Balanced Strategy, for hedging purposes only, when this is necessary to mitigate risk and avoid further losses on the portfolio. Such use of derivatives shall not be part of the Asset Allocation.
Use of Derivatives. The use of derivative financial instruments may only be used to establish coverage. The use of derivatives shall be noted in the investment policy and shall have Risks Committee approval. To these effects, derivative financial instruments will be defined as those established in numeral 2, clauses a, b, c, d, e, f and g of article 30 of Agreement 5-2004 of July 23, 2004 and articles 31 and 32 of said Agreement shall be applicable mutatis mutandis. Structured operations may only have as subjacent those assets allowed in article 27 of this Agreement. 33 The Retirement and Pension Funds Investment Managers must perform transactions with derivatives with the utmost care, ensuring that their agents posses the knowledge and experience necessary to manage these instruments. Likewise, they must keep a derivatives operations register and the results from these obtained.
Use of Derivatives. We use foreign currency forward exchange contracts to reduce the impact of currency fluctuations on certain anticipated intercompany purchase transactions that are expected to occur within the fiscal year and certain other foreign currency transactions. Related gains and losses are recognized when the contracts expire, which is generally in the same period as the underlying foreign currency denominated transaction. These contracts do not subject us to significant market risk from exchange movement because they offset gains and losses on the related foreign currency denominated transactions. At June 30, 1998, there were no significant amounts of open foreign currency forward exchange contracts or related unrealized gains or losses. At June 30, 1999, we had forward contracts to buy foreign currencies with a face value of $9.0 million. These contracts matured on various dates between July 1999 and January 2000 and had a negative fair market value of $632,000 at June 30, 1999. At December 31, 1999, we had forward contracts to buy foreign currencies with a face value $4.8 million. These contracts mature on various dates between January 2000 and June 2000 and had a negative fair market value of $228,000 at December 31, 1999. The 45 CIRCOR INTERNATIONAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Use of Derivatives. Derivative financial instruments may only be used to establish coverage. The use of derivatives must be established in the investment policy and must have Risks Committee approval. To this effect, derivative financial instruments are those established in numeral 2, numerals a, b, c, d, e, f and g of article 30 of Agreement 5-2004 of July 23, 2004, and the content of articles 33 and 34 of said Agreement shall be applicable mutatis mutandis. Structured operations may only have the subjacent assets allowed in article 27 of this Agreement.”
Use of Derivatives. Derivative securities, such as futures, options and swaps will not be permitted.
Use of Derivatives. Derivative securities, such as futures contracts or options may be used only as a tax deferral mechanism for stocks held in the portfolio or to equitize cash.
Use of Derivatives
