FpML Issues Tracker

58: Not all assets are equities

March 24, 2004

closed

Minor

Always

Feedback and Suggestions

Admin

mgratacos

Summary

I understand the use of the term 'equity' to reflect the historical origin of the products defined in fpml-eqs-4-1.xsd. They came out of the equity market as products and the contribution out of an equity team.

My most frequent use of 'equitySwap' is for Bond Index TRS and LPI TRS. Neither of which could be described as equities. One is an asset and the other an index. The EquitySwap product type copes admirably with these but is misnamed. The eqs package seems to be misnamed throughout.

It is possible but not desirable to live with the misnaming. It just one more thing to explain to clerks, traders, and analysts that look at the messages.

Please could references to equity be replaced by something like 'asset'.

Notes:

  • mgratacos

    10/19/05 11:15 am

    In FpML 4.2 Second Working Draft (2005-10-12) the equity swap structure has suffered important changes to better support return type swaps. These changes include:

    The fpml-eqs-4-2.xsd file has been renamed fpml-return-swaps-4-2.xsd. In addition, the following changes have been implemented:
    – equitySwap has been deprecated (it will be removed in the next major version) and a new returnSwap element has been created.
    – the new head of the substitution group is now called returnSwapLeg (it was called returnLeg before).
    – equityLeg has been deprecated (it will be removed in the next major version) and a new returnLeg element of type ReturnLeg has been created.
    – ReturnLeg type has the same structure as EquityLeg but the following elements have been renamed:
    — valuation is now called rateOfReturn
    — equityAmount is now called amount.
    — equityNotionalReset is now called notionalReset.
    — equityPaymentDates is now called paymentDates
    — equityValuation is now called valuationRules
    — equityPaymentDatesInterim is now called paymentDatesInterim
    — equityPaymentDateFinal is now called paymentDateFinal

    The types of the elements listed above have been renamed as well but the old types are being kept in the schema for backward compatibility reasons.

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