Use

After contracting parties have reached an agreement, the system uses the agreed conditions to create a forward securities transaction.

Short Sale

It is also possible to sell forward securities if the quantity to be sold is not available in the position when the contract is concluded.

Prerequisite

The position lock settings must state No Lock or Lock Generates Warning.

Prerequisites

You need to set up a product type in Customizing for forward securities transactions.

The security involved must be defined in the system as a class .

The business partner involved must be created in the system.

Procedure

Call the function Create Financial Transaction under Transaction Manager → Derivatives → Trading.

Specify the Company Code, Product Type, Transaction Type ( Purchase or Sale ), Business Partner, and ID Number .

If you first select Forward Securities Transaction in the Default Entry Financial Transaction area, the input help only displays the product types and transaction types available for this product category.

Choose Create .

The following tab pages are provided to help you enter the transaction data:

Structure

Here you enter the following transaction data:

Underlying Position Data

- Securities Account

- General Valuation Class

- Portfolio

- Position Date

Term

- Start of Term

- End of Term

- To enter rollover periods, set the Possible to Roll Over indicator. Then select the Rollover Periods pushbutton and enter the periods that have been agreed upon.

It is still possible to roll over the transaction if the indicator has not been set.

Amounts

- Number of Units

- Forward Price

If the forward securities transaction is saved, the system checks whether the forward price is calculated as below. If the calculation does not match the following procedure, the system displays a warning message. However, the transaction is still saved.

Forward purchase

Forward price = spot price + costs + interest - dividend

Forward sale

Forward price = spot price - costs + interest – dividend

Note : The dividend flow takes into account the actual dividend (“active” status). If the actual dividend is not available, the expected dividend is taken into account.

- Spot Price

- Costs

- Interest

- Amount

The amount is calculated using the data entered.

Exercise

You set the Settlement indicator to determine either Cash Settlement or Physical Exercise . You can also set the indicator if you select the Delivery function and then the option Not Yet Specified .

Contract

- Contract Date

- Contact Partner

- Trader

- External Reference

Dividends (only forward stock and investment transactions)

Dividend Plan

Here you can enter the actual and expected dividends.

It is possible to enter and change the expected dividends at any time. To enter the actual dividends, you can use the function Adjust Dividends .

Expected dividends that are within the term of the forward security transaction have the status Active . Dividends that are not within this period have the status Inactive .

Value Flow

In this area, you can enter the flow of amounts during a dividend adjustment.

Administration

Other Flows

Payment Details

Cash Flow

Memos

Partner Assignment

Status

Create Analysis Parameters (RM)

Save your entries.

Result

The system creates the forward securities transaction as a Contract . For more information on processing the forward securities transaction further, see Forward Securities Transactions .