Calculation agent: it might not sound like something to get the blood racing, but it is at the heart of one of the biggest changes in Europe’s convertible bond market in the past decade.
For every single deal, someone has to work out how any corporate action by an issuer might affect the number of shares a bondholder will receive. And that’s just for starters. With all their bells and whistles, equity-linked instruments are decidedly high-maintenance products.
Until 2012 there simply was no dedicated calculation agent in the equity-linked market.
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