Page 136 - PRIAA Glossary
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Q
QUAD-PARTY SEGREGATION
A type of segregation where collateral is held by a fourth party, such as a custodian rather than by the clearing broker or the central counterparty (CCP).
QUALIFIED INTERMEDIARY
An entity identified under the US Internal Revenue Code to act as a go-between for income reporting and tax withholding.
QUANTO
A product where the underlying is denominated in one foreign currency but settled at a fixed rate in another currency. It uses a floating rate of a non-domestic interest rate and applies this to a notional amount in a domestic currency. Such products are common amongst speculators looking to gain exposure to foreign assets yet looking to protect themselves from exchange rate fluctuations.
QUANTO SWAP/DIFFERENTIAL SWAP
An interest rate swap where one of the floating rates is a non-domestic interest rate, but it is applied to a notional amount denominated in the domestic currency. Also known as a “differential swap”.
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