For
Immediate Release Tuesday, August 5, 2003
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Changes in the second draft incorporate the ISDA May Credit Derivatives Supplement and the Master Confirmation. The new draft also permits the referencing of specific Reference Entity data within credit derivatives transactions, a key issue for the industry. It is anticipated FpML version 4.0 will go to trial recommendation in the Fall of 2003 and to final recommendation by the end of the year.
In addition to interest rate derivatives and FX derivatives, which were defined in earlier versions of the standard, FpML version 4.0 covers equity derivatives, including equity swaps and credit derivatives. The work on credit derivatives is very closely linked to the ISDA 2003 Credit Derivatives Definitions, which define the credit default swap. On a technical level, version 4.0 is the first schema-based version. It is also the first version that puts a messaging framework around the product descriptions to specify their context and use. The full text of the working draft is available at fpml.org.
FpML is a business information
exchange standard for electronic dealing and processing of financial derivatives
instruments. It establishes the industry protocol for sharing information on,
and dealing in, financial swaps, derivatives and structured products over the
Internet. It is based on XML (Extensible Markup Language), the standard
meta-language for describing data shared between applications. FpML will eventually cover all categories of privately
negotiated derivatives. Information about the FpML
standard, the specifications and the different working groups can be found on
the FpML web site: www.fpml.org.
ISDA is the global trade
association representing leading participants in the privately negotiated
derivatives industry. ISDA was chartered in 1985, and today has more than 600
member institutions from 46 countries on
six continents. These members include most of the world's major
institutions that deal in privately negotiated derivatives, as well as many of
the businesses, governmental entities and other end users that rely on
over-the-counter derivatives to manage efficiently the financial market risks
inherent in their core economic activities.
Information about ISDA and its activities is available on the
Association's web site: www.isda.org.
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