Synthetic Security. A security or swap transaction, other than a Participation Interest, that has payments associated with either payments of interest on and/or principal of a reference obligation or the credit performance of a reference obligation.
Synthetic Security. Any U.S. Dollar denominated swap transaction (including any default swap), LCDX, structured bond investment, credit linked note or other derivative investment, which investment contains a probability of default, recovery upon default and expected loss characteristics closely correlated to a reference obligation, but which may provide for a different maturity, interest rate or other non credit characteristics than such reference obligation.
Synthetic Security means any Dollar denominated swap transaction, LCDX, structured bond investment, credit linked note or other derivative investment purchased from, or entered into with a counterparty, which investment contains a probability of default, recovery upon default and expected loss characteristics closely correlated to a reference obligation, but which may provide for a different maturity, interest rate or other non-credit characteristics than such reference obligation.
Examples of Synthetic Security in a sentence
However, as a result of the terms of the Synthetic Security and the assumption of the credit risk of the applicable Synthetic Counterparty, a Synthetic Security may have a different expected return, a different (and potentially greater) probability of default, a different (and potentially greater) expected loss characteristic following a default and a different (and potentially lower) expected recovery following default.
As referred to above, a Synthetic Security which is a Defaulted Obligation will generally be settled either by a cash settlement or a physical settlement.
Additionally, the terms of a Synthetic Security may provide for different maturities, payment dates, interest rates, interest rate references and credit exposures and non-credit related exposures to obligations of the Issuer other than the Reference Obligation relating thereto.
In addition to the credit risks associated with holding loans with respect to Synthetic Securities, the Issuer will usually have a contractual relationship with the relevant Synthetic Counterparty only, and not with the Reference Entity of the Reference Obligation (in each case as defined in the relevant Synthetic Security).
Such amounts may be significantly less than the original principal amount of such Synthetic Security or, in certain circumstances, zero.
More Definitions of Synthetic Security
Synthetic Security means any Euro (which, for the avoidance of doubt, includes securities denominated in a legacy currency of those EU Member States which have adopted the Euro as their currency) denominated swap transaction, debt security, security issued by a trust or similar vehicle or other investment purchased from or entered into by the Issuer with a Synthetic Counterparty that satisfies, save to the extent otherwise agreed by the Rating Agencies, the Eligibility Criteria save for that relating to the jurisdiction of the Obligor thereunder, the returns on which (as determined by the Investment Manager) are linked to the credit and/or price performance of a Reference Obligation but which may provide for a different maturity, payment dates, interest rate, credit exposure or other non-credit related characteristics than such Reference Obligation; provided that:
Synthetic Security means any transaction, agreement or arrangement (or series of transactions, agreements or arrangements), including, without limitation, any derivative, swap, hedge, repurchase or so-called “stock borrowing” agreement or arrangement, the purpose or effect of which is to, directly or indirectly: (a) give a person or entity economic benefit and/or risk similar to ownership of any securities of the Corporation, in whole or in part, including due to the fact that such transaction, agreement or arrangement provides, directly or indirectly, the opportunity to profit or avoid a loss from any increase or decrease in the value of any securities of the Corporation, (b) mitigate loss to, reduce the economic risk of, or increase or decrease the voting power of, any person or entity with respect to any securities of the Corporation, or (c) provide the opportunity to profit or avoid a loss from any decrease in the value of any securities of the Corporation.
Synthetic Security. A security or swap transaction, other than a Participation Interest, that has payments associated with either payments of interest on and/or principal of a reference obligation or the credit performance of a reference obligation. Tax: Any tax, levy, impost, duty, deduction, withholding (including backup withholding), charge, assessment or fee of any nature (including interest, penalties and additions thereto) imposed by any governmental taxing authority.
Synthetic Security means either a Synthetic Purchase Contract or a credit-linked note in respect of which each supporting credit default swap is a Form-Approved Swap or is in a form which has been the subject of a Rating Agency Confirmation.
Synthetic Security means any swap transaction, debt security, security issued by a trust or similar vehicle or other investment purchased from or entered into by the Issuer that satisfies the Eligibility Criteria with a Synthetic Counterparty, the returns on which (as determined by the Investment Manager) are linked to the credit and/or price performance of a Reference Obligation but which may provide for a different maturity, payment dates, interest rate, credit exposure or other non-credit related characteristics than such Reference Obligation; provided that:
Synthetic Security means a security or swap transaction (other than a Letter of Credit or a Participation) that has payments of interest or principal on a reference obligation or the credit performance of a reference obligation.
Synthetic Security means any Euro (which, for the avoidance of doubt, includes securities denominated in a legacy currency of those EU Member States which have adopted the Euro as their currency) denominated swap transaction, debt security, security issued by a trust or similar vehicle or other investment purchased from or entered into by the Issuer with a Synthetic Counterparty that satisfies, save to the extent Rating Agency Confirmation is received in respect of any non-satisfaction thereby, the Eligibility Criteria, the returns on which (as determined by the Collateral Manager) are linked to the credit and/or price performance of a Reference Obligation or a recognised international index (subject to the consent of the Rating Agencies) but which may provide for a different maturity, payment dates, interest rate, credit exposure or other non-credit related characteristics than such Reference Obligation; provided that: