4 Define ET Instruments

Each instrument that you enter in Oracle Banking Treasury Management should necessarily be associated with an instrument product. To recall, you have already defined instrument products to group together or categorize instruments that share broad similarities. Instrument products provide a general framework and services to classify or categorize instruments. Under each Product that you have defined, you can enter specific instruments. By default, an instrument inherits all the attributes of the instrument product, which is associated with it. These include:

• Instrument Type
• Asset Type linked to the product
• Whether physical settlement of the underlying asset is possible
• Whether settlement can be made prior to the Expiry Date

This means that you will not have to define the general attributes each time you enter the instrument details. In addition to the product preferences, you will have to capture the other details of the instrument. They include:

• Instrument details
• Underlying Asset details
• Pricing details
• Price movement details
• Max Open and Long positions
• Days of settlement
• Initial margin per contract

This topic has the following subtopics:

• Instrument Definition
  This topic describes how to define the instrument and actual instrument examples.
• Process Instrument Margin
  This topic describes the systematic instruction to process the Instrument Margin screen.
• Process Margin Details and Instrument Price Details
  This topic describes the systematic instruction to process the Margin Details and Instrument Price Details.
• Position and MTM Calculations for Instruments
  This topic describes the Position and MTM calculations can be done through the batch process.