1. Asset Liability Management User Guide
  2. Transfer Pricing Rules
  3. Defining Tractor Methodology

31.11 Defining Tractor Methodology

The prerequisites for defining a Tractor Methodology are:

  • Creating a Replicating Portfolio.
  • Generating (and maintaining) the Portfolio. Volatile and Core Instrument strips will be created in the FSI_M_REP_PORTFOLIO_STRIPS table.

To define and use a Tractor TP Method:

  1. Define the Transfer Pricing Rule and select the Tractor Method from the list of available TP Methods for relevant Product Dimension Members.
  2. Select the appropriate Replicating Portfolio.
  3. Select the Transfer Pricing Interest Rate Code.
  4. Define a Transfer Pricing Process and Run using the TP Rule.
    • TP Process Transfers Price the non-zero portfolio strips using a Straight Term Method.
    • TP Process computes a weighted average TP Rate for the portfolio and will update all instruments mapped through the TP Rule to this method.