Trading in Financial Instruments

Dr Marcin Spyra

Financial instruments and securities

Financial instruments

Securities according to theArt. 3 pt 1 TFIA

Securities (according to the Civil Code

Interest rate swap.

Debtor

WIBOR 6M + 3%

WIBOR 6M + 3%

Fixed interest rate

Equity swap

Investor

Investment: 100,000 shares of X plc the target is: 50 PLN forshare

5.000.000 PLN on expiration date

Market price for 100,000 shares of X plc on expiration date

Stock Put Option

BuyerIssuer

50,000 shares of X plc bought at the spot price 10 PLN

The obligation of the issuer to buy 50,000 shares of X plc for the strike price 10 PLN

Premium 50,000 PLN

Option Spread (options without premium)

Exporter Bank

Revenues€

Expenses PLN

Put option underlying asset € strike price 3,4 PLN

Put option underlying asset € strike 3,2 PLN

Call option underlying asset € strike 3,5 PLN

Credit derivatives

Credit default swap

Total return swap

Credit linked notes

Financial market.

Financial market

Organized Unorganized

Regulated

Securities exchange

OTC Regulated Market

Alternative Trading Platform

The „Shipyard” case.

Shipyard

Bank

Secured loanUnderwriting

agreementCharitable Association

Brokerage services

Bonds

Uncomplicated financial instruments

1) shares admitted to trading on a regulated market or equivalent market in a country which is not a Member State;2) bonds or other debt securities, which have not an embedded derivative;3) units of investment funds, foreign funds participation titles and titles of the participation of open-end investment funds based in countries belonging to EEA and open-end investment funds established in OECD member countries other than the Member State of EU or EEA

Uncomplicated financial instruments

- There is, on an ongoing basis, the ability to dispose of, redeem or otherwise realize the value of the instrument at a price that is publicly available to market participants and which is the market price or the price specified, or approved by the pricing system independent of the issuer of financial instruments,- Instruments are not related to actual or potential liabilities in excess of the customer acquisition cost of these instruments,- There is a publicly available information explaining their characteristics in a manner understandable to the client