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S.No.
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Terms
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Description
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1.
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Best Yield – Time Priority
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Best Yield – Time Priority refers to the matching principle that the system follows in matching the offers with bids and vice versa. The Best Bid Yield for an Offer is the Bid yield which is equal to or less than the Offer Yield quoted by the borrowers. The Best Offer Yield for a Bid Order is the Offer Yield which is equal to or greater than the Bid Yield quoted by the lenders. If there are two or more identical Bid/Offer orders with the same Bid/Offer Yield, then the system follows the “Time Priority” principle based on the time of receipt of order by the system.
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2.
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Initial Margin
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Initial margin is collected to take care of the volatility in interest rates in case of default by the lenders.
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3.
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Offer
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Offer refers to an order for borrowing funds.
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4.
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Bid
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Bid refers to an order for lending funds.
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5.
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Order Lot
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Order Lot refers to the minimum amount that is required to constitute a successful trade on the trading system.
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6.
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Trading/Dealing Session
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Trading/Dealing Session refers to the market hours fixed by CCDS when members are permitted to conclude trades among themselves.
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7.
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Uniform yield
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Uniform yield is the cut-off rate which is applicable to both the borrowers and lenders.
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8.
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Volatility
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Volatility is a statistical measure of a market or a security's price movements over time and is calculated by using standard deviation.
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9.
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Volatility Margin
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Volatility Margin is the extra margin which may be imposed by CCDS on both borrowers and lenders in the event of sudden increase in volatility of interest rates in the market.
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10.
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Close-out
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Close-out is a process by which the CBLO shortfall quantity is distributed proportionately to members having net bought position in the concerned CBLO.
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11.
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Hair-cut
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Hair-cut is stipulated by CCIL to protect itself from potential losses arising on account of decline in market value of security held as collateral.
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12.
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Margin Call
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Margin Call refers to the demand made by CCIL on a member to deposit additional funds and/or securities towards fulfillment of its margin obligation.
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13.
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Member ID
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Member ID refers to the Identification Code allotted to each member of CCIL to establish the identity. ID is unique to every member.
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