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fyvr
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Joined: November 15th, 2015, 3:10 pm

Gadget?

April 6th, 2019, 5:45 am

Hi, ex-trader here (now a consultant). On the EUR swaps page on Bberg, we have rates from 1-60 years, and then "5yr gadget = 51" and "10yr gadget = 63". What are these?
 
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bearish
Posts: 4968
Joined: February 3rd, 2011, 2:19 pm

Re: Gadget?

April 6th, 2019, 6:24 pm

Beats me. And I used to know something about such matters... But, one of the things you pay $20K+ per year for is the ability to hit Help Help and ask somebody. And when they are useless (as often happens), ask them to escalate to the adesk or an application specialist. The knowledge undoubtedly resides somewhere in there. 
 
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katastrofa
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Location: Alpha Centauri

Re: Gadget?

April 6th, 2019, 8:58 pm

Deleted.
Last edited by katastrofa on April 7th, 2019, 1:56 am, edited 4 times in total.
 
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ISayMoo
Posts: 2050
Joined: September 30th, 2015, 8:30 pm

Re: Gadget?

April 6th, 2019, 9:08 pm

You can pay $20K+ year for someone to explain things to you, or use Google and find the answer in less than 1 minute: https://www.tradition.com/media/267051/ ... r-2017.pdf

"1.1 The following product types shall be eligible for admission to and capable of being traded on the Platform: [...]
‘Gadgets’, being Euro interest rate swaps dated from spot to specified outright maturity dealt with a future hedge of corresponding size, quoting the front two contracts."

I also learned a new word: "cockdated". It means "maturing at a non-standard date" (https://onlinelibrary.wiley.com/doi/pdf ... 8330.gloss)
 
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fyvr
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Joined: November 15th, 2015, 3:10 pm

Re: Gadget?

April 7th, 2019, 4:05 pm

Yeah, I found the definition on the tradition website. The reason I posted the question is that, having read the definition, I’m still not sure what “5yr gadget = 51” actually means. Anybody able to clarify?
 
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ISayMoo
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Re: Gadget?

April 7th, 2019, 5:56 pm

51 bps?
 
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bearish
Posts: 4968
Joined: February 3rd, 2011, 2:19 pm

Re: Gadget?

April 7th, 2019, 10:00 pm

You can pay $20K+ year for someone to explain things to you, or use Google and find the answer in less than 1 minute: https://www.tradition.com/media/267051/ ... r-2017.pdf

"1.1 The following product types shall be eligible for admission to and capable of being traded on the Platform: [...]
‘Gadgets’, being Euro interest rate swaps dated from spot to specified outright maturity dealt with a future hedge of corresponding size, quoting the front two contracts."

I also learned a new word: "cockdated". It means "maturing at a non-standard date" (https://onlinelibrary.wiley.com/doi/pdf ... 8330.gloss)
Would you like to put the Gadget definition into your own words? Or, even better, into an equation? With 5Y EUR swaps trading in a 5bps context, and futures being a zero up-front trade, the 51 quote (whether bps or not) is still a bit of a mystery. At least to me...
 
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ISayMoo
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Re: Gadget?

April 8th, 2019, 7:46 am

5.1 bps then ;-)
 
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fyvr
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Joined: November 15th, 2015, 3:10 pm

Re: Gadget?

April 8th, 2019, 12:21 pm

I’m sure the number is bps. For the life of me though, I can’t figure out it refers to.
 
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bearish
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Joined: February 3rd, 2011, 2:19 pm

Re: Gadget?

April 8th, 2019, 12:59 pm

From page 2 of running DES on one of said gadgets: “EUR bond futures swap spread. Quoted as yield spread between the Bund future and the spot starting swap rate”.
 
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fyvr
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Joined: November 15th, 2015, 3:10 pm

Re: Gadget?

April 8th, 2019, 1:06 pm

oh ok, it’s sort of a synthetic spread to Bunds, for swaps that are traded with-delta. Thank you Bearish. 

(If you’re thinking I’m an idle sod for not doing that myself, I’m doing the Inca trail trek and weirdly there are no Bloomberg terminals to be found). 
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