Abstract

Standardization is at the heart of the G20 declaration on financial reform of the OTC derivatives market and is driving the development of a host of industry initiatives. The key delivery this year is the publication of the 2011 ISDA Equity Derivatives Definitions. These definitions represent the single largest overhaul of OTC trade documentation methodology since definition booklets were first introduced. Their aim is to create a flexible documentation structure built for today’s markets to facilitate electronic processing across the full range of equity derivative products. Although the industry has been well aware of these pending changes, most market participants are unprepared. This article addresses the challenges firms are facing as they prepare for the ISDA definition changes and offers solutions to help guide the process. <b>TOPICS:</b>Exchanges/markets/clearinghouses, derivatives, quantitative methods

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