Equity Swaps

Parties exchange risk and gains on tokens for a period of time

Equity Swaps allow parties to swap limited reciprocal loss or gains for a period of time.

Exchange exposure on a bag of tokens with another party for a duration of time. Both gains and losses on the underlying assets belong to the Equity Swap buyer / taker at the end or expiry. Payoff is paid in underlying assets if taker / buyer is in profit, and in paired currency when the writer is in profit. This is because equity swaps are also bought in paired currency.

This settlement process is synthesized in our settlement function to give the same outcome in one function call, without needing to buy and sell tokens.

Equity Swap Features:

• Underlying Asset or tokens being swapped

• Start price quoted in paired currency

• Expiry date or duration

• Cost to buy hedge, quoted in paired currency

When swapping exposure on a bag of ERC20 tokens with equity swaps:

• Both parties have to provide equal collateral.

• Gains are limited to 100% of one party's collateral.

• Losses are limited to 100% of one party's collateral.

• Settlement is processed in paired currency or cost currency.

Screenshot

Example