Examples of OTC derivatives in a sentence
In general, the credit risk for derivatives that are traded on a stock market is lower than the risk for OTC derivatives, as the clearing office acting as the issuer or counterparty of each derivative traded on the stock exchange assumes a settle- ment guarantee.
Level of the collateral The Management Company shall stipulate the necessary level of the collateral for transactions with OTC derivatives and for efficient portfolio management techniques by referring to the applicable limits set out in the Prospectus for counterparty risks and taking account of the nature and the characteristics of the transactions, the creditworthiness and the identity of the counterparties as well as the prevailing market conditions.
The proposal also requires market participants to mitigate risks when operating on derivatives mar- ket, for example using electronic means to confirm the terms of OTC derivatives contract.