Treasury&RiskMgmt-Securities

Hi,
Please explain to me the below terms with examples
1) Price valuation procedure
2) Impairment procedure
Regards

Hi,
FWBS - Manual Posting is valid only for securities. I am just giving an example.
In securities there might be some charges for holding an account which is not periodical. Also there will be brokerage/ commisision involved for transactions which can be posted using manual posting.
Regards,
Ravi

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Treasury&RiskMgmt

Hi,
What is the definition of "SPREAD" in terms of finance. Please explain with some examples
Regards
Blessy

Spread is the difference between two similar measures In the stock market, for example, the spread is the difference between the highest price bid and the lowest price asked.
With fixed-income securities, such as bonds, the spread is the difference between the yields on securities having the same investment grade but different maturity dates.
For example, if the yield on a long-term Treasury bond is 6%, and the yield on a Treasury bill is 4%, the spread is 2%.
The spread may also be the difference in yields on securities that have the same maturity date but are of different investment quality.
For example, there is a 3% spread between a high-yield bond paying 9% and a Treasury bond paying 6% that both come due on the same date.
The term also refers to the price difference between two different derivatives of the same class.
For instance, there is typically a spread between the price of the October wheat futures contract and the January wheat futures contract. Part of that spread is known as the cost of carry. However, the spread widens and narrows, caused by changes in the market -- in this case the wheat market.

Treasury&RiskMgmt-Hedging

What is meant by Fair Value Hedge and Cash flow hedge??

Hi
First you need to know what an hedge is
Hedging - In finance, a hedge is a position established in one market in an attempt to offset exposure to the price risk of an equal but opposite obligation or position in another market u2014 usually, but not always, in the context of one's commercial activity. Hedging is a strategy designed to minimize exposure to such business risks as a sharp contraction in demand for one's inventory, while still allowing the business to profit from producing and maintaining that inventory.
Fair Value Hedge
Fair value hedges primarily relate to fixed-interest balance sheet items (eg receivables, equities or securities), which are hedged against market ...
Cash flow hedge
A cash flow hedge is a hedge of the exposure to the variability of cash flow that
- is attributable to a particular risk associated with a recognized asset or liability. Such as all or some future interest payments on variable rate debt or a highly probable forecast transaction and
- could affect profit or loss
Cash flow hedges are primarily taken to mean hedges against the risk associated with future interest payments from a variable-interest balance sheet transaction by means of a swap. They are measured at their fair values.
check the below link for more details
http://www.attuariale.com/ias39.php?language=English
hope this helps
regards,
radhika

Treasury&RiskMgmt-Correspondence-Reconciliation flag

Hi,
ERP2005Ehp4 Release
SAP-FSCM -Product
In the customizing settings for the correspondence user can check the flag "Reconciliation"
What does it mean???
The customizing path is: SPRO --> Financial Supply Chain Management --> Treasury & Risk Management > Transaction Manager> General Settings --> Correspondence --> General Settings --> Assign Attributs for Business Partner Groups
Regards
Blessy

Hi,
I am sending only answers.If wrong pls correct me.
1.A,C
2.C
3.A,B,D,E
4.ACE
5.ABCD
6.B
7.BE
8.ALL
9.ABC
10.ABCDE
11.A
12.ABCD
13.E
14.BC
15.ALL
16.ABC
17.ACD
18.AC
19.B
20.ACDE
21.DE
22.B
23.ABCD
24.CD
25.C
26.BDE
27.BCE
28.C
29.CDE
30.BCDE
31.BDE
32.A
33.B
34.ALL
35.ABC
36.ALL
37.ABC
38.A
39.ACDE
40.AB
41.ABE
42.CD
43.ABCE
44.CD
45.ACDE
46.BD
47.AC
48.CD
I have sent answers for the questions.If any answer is wrong pls correct me.
Assign points if useful
Regards,
S.VINAYA KUMAR

Treasury&RiskMgmt - Exposure Management

Hi,
The context is "Report Logistics in logical database for exposures"
Here, What is meant by "Logistics" ???
Thanks & Regards
Blessy

Hi Blessy,
Can you explain a bit more, maybe with some transaction codes etc? Informative questions are more prone to get better responses
best regards!
Sandip

Treasury&RiskMgmt-FRA

What is FRA?? Please reply me a detailed way with examples in a business point of view??

Hi Blessy,
FRA is forward rate agreement. it is for aperiod. Example is 6/9 FRA means that the period start is six months and end is 9 months. During this period you will enter an interest rate swap. Again this swap will have a floating leg and a fixed leg. Those details will be entered in the system.
Hope this helps
best regards!
Sandip

Treasury&RiskMgmt-Option

Hi,
I will explain one example contains the process sell/buy options. Please go through this and advise me on the same
EUR/USD
Spot price : 1.40
Strike Price: 1.45
a) SellCall
b) SellPut
c) BuyCall
d) BuyPut
Which options will exercise (a,b,c,d)
1. If the current price is 1.40
2. If the current price is 1.45
3. If the current price is 1.50
and what is the reason for exercising those optins???
Regards
Blessy

Hi Blessy,
A very nice question. maybe the same can be executed also in the system.
Best regards!
Sandip

Treasury&RiskMgmt-Stocks

Hi,
Please explain what is Spot, Strike, Forward prices with examples???
Regards
Blessy

Hi,
Spot is nothing but the current price, while stike price is the price which you are going to fix in your option. Suppose you have an option between USD/EUR, then exchange rate price is spot price while the price on the exercise date for this option is the strike price. Ultimately strike price will be price at which this option will be exercised.
Future price is nothing but the price in the case of futures contract. A future contract is an obligation for both buyer and seller i.e one has to sell and the other has to buy. While in the case of option, either the buyer or the seller wil have the option to buy or sell.
Regards,
Ravi

Treasury&RiskMgmt-Transaction Manager- Money market

Hello Colleague,
In the creation of Money market - Fixed Term Deposit - investment , one select box for Capitalize interest is present
What does this capitalize interest means?? why it is in the Money market?

Hi,
It depends on country you are using.
if you check capitalize interest, interest would be added to your deposit account i.e. asset account. Then it means that interest amount has also been added to the asset and hence we will not pay tax on interest amount. This is generally done, when you invest back the money which you got from deposit including interest. Then since you are investing, you won't pay tax for it i.e you are using the money.
If you have not checked the capitalize interest, then you will get the interest amount to your bank or cash and hence it is a revenue, thus you will have to pay tax for interest amount alone depeding on the amount and also the country.
P.S: If the question is answered kindly close the question.
Regards,
Ravi
Edited by: Ravishankar Ramamurthy on Jul 8, 2009 5:57 PM

Asset Backed Securities (ABS) Treasury-Securities CFM FSCM Configuration

Hi Sap Masters,
I need some help on configuring Asset backed Securities in Treasury-Securities, If anyone can guide me on detailed configuration steps on same that will be good. I also need some usermanual related to this functionality.
If anyboby has come across such ABS configuration please help me.
I need this functionality ASAP.
Please keep posting
Thanks & Regards
Bhavesh

Asset Backed Securities CFM Treasury Securities FSCM Configuration guidance

Hi Sap Masters,
I need some help on configuring Asset backed Securities in Treasury-Securities, If anyone can guide me on detailed configuration steps on same that will be good. I also need some usermanual related to this functionality.
If anyboby has come across such ABS configuration please help me.
I need this functionality ASAP.
Please keep posting
Thanks & Regards
Bhavesh

Pledging of Securities possible in Treasury Module?

Dear All,
Anyone please let me know whether SAP Treasury module can handle 'pledging of securities'??
Thanks & Regards
Ramesh Nair

Hi Ramesh,
basically there is no specific transaction to execute this functionality. But there is a similar function since ERP2005 which is called security lending. This functionality enables you to lend securities to someone and get a interest for this period or lend security from a counterpart and pay a interest amount.
Best regards
Robert

Government Securities - SAP Treasury Securities

Government Securities
Government security INR 100000
Government Securities Maturity Period: 3 years from the date of subscription i.e. Jan 2014
Interest on Government Securities: 8%
Interest frequency: Bi-annual (june 30, Dec 31)
Here, what are the steps required in the key date valuation like (amortization procedure, security valuation, One step price valuation etc)
Currently, i am following below steps
TRS_SEC_ACC: Securities account creation
FWZZ: Security Class
TS01: Purchase
Sale of Security
Interest Update and Automatic Debit Posting

Dear Krishna,
I'll try to answer in steps.
1) Master data creation.
   a) Security account creation: TRS_SEC_ACC
   b) Security class: FWZZ
   C) Business Partner: BP
2) Create a deal- FTR_create or TS01
3) Settle deal: FTR_edit
4) Posting : TBB1
5) Period end activities:
a) TPM44
b) Update market price: FW18
c) FWZE/FWSO
D) Armotization (TPM1)
Mention above are basic activities need to performed for securities accounts
Answering to your question about the steps of key date valuation- Its based on what customer requirement, whether they want mark to market or ect. Please check with user department for the same.
I hope this will help.
PS: all the setting related with key date valuation will he taken care by consultant.
Regards,
jain

Treasury:Securities Module-Dividend Calculation-Investment Certificates

Dear Friends,
When dividend calculation is done at T.code FWZE, the system is calculating the dividend as defined at T.code FWZZ correctly,but it is calculating only on the original units but not on the cumulative capitalized Units.
The process requires the dividend to be calculated on the cumulative units since the option is Reinvestment of dividends.
We have tried with User Exit FV970001 & F64O0001 but with no positive result.
Please help us with a solution.
Regards,
Srinivas & Rubel
+91 9347259234

Dear Friends,
Pls help as I am clueless!
Thanks and Regards,
Srinivas and Rubel.

Error while creating position indicator in Treasury

Hi,
I got an error message "No differentiation was defined in Customizing for this position" while creating position indicator in Treasury Mgt for Securities ( TPM55A).
Message no. TPM_TRL098
Please help me on this issue. Very urgent.
Thanks & Regards,
Shaik.A

HI,
I have resolved the issue.
Maintained Sec.Acct.
FSCM-Treasury & Risk Mgt-Transaction Mgr-General Settings-Accounting-Settings for position Mgt-Define and Assign Differentiations
Regards,
Shaik.A
Edited by: shaik A on Mar 31, 2008 1:14 PM

Treasury&RiskMgmt-Securities

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