Certificates of deposit are short-term zero-coupon security. It only has two flows: an initial drawing at the start date and a repayment at the maturity date.
In Fairways Debt, the certificate of deposit has a generic counterparty called Market.
Navigate to the Debt & Derivatives Application
- Log in to your Fairways Debt account.
- Select a customer account.
- Navigate to Applications > Debt & Derivatives.
Create a Certificate of Deposit
- Open an issuing program with the Certificate of Deposit bond type.
- Navigate to Bonds.
- Click Add Bond > Create Certificate.
- Complete the form with all relevant details.
Note: Fields marked with an asterisk * are mandatory.
| Field | Description |
|---|---|
| Transaction Reference Code |
Identifies the transaction in the portfolio. Note: The reference must be unique among all the entities managed in the account. |
| External Reference Code | Used by external systems to identify the transaction. Used when transactions are imported from or exported to another system. |
| Principal | Principal amount. |
| Currency | Reference currency. |
| Issuing and Paying Agent |
A third party, usually a commercial bank, which accepts the payments from the issuer and then distributes the related amount to the holders of the bond. Note: The issuing and paying agent is by default the same as for the issuing program. |
| Field | Description |
|---|---|
| Trade Date | Date at which the transaction has been traded. From that date, the system takes the transaction into account as an item of the portfolio. |
| Start Date | Unadjusted start date of the transaction. |
| Maturity Date | Unadjusted maturity date of the transaction. |
| Field | Description |
|---|---|
| Yield | Annual yield of the certificate. |
| Spread | Spread (or margin) value in percentage. |
| Day Count Convention | Used to compute the day fraction of an interest accrual period. |
| In Advance Interest Payment |
Defines whether the interest amount should be paid at the start of the period. If enabled:
If disabled:
Note: If enabled, the With Discount field becomes available. |
| With Discount |
Note: This field is only available for in advance interest payments. Applies a discount rate to the interest amount. |
| Field | Description |
|---|---|
| Interest Calculation Adjustment | Adjustment mode for the interest calculation. The nominal start and end dates of the accrual period will be adjusted accordingly before computing the interest amount. |
| Payment Date Adjustment | Adjustment mode for the payment date. |
- Enable Show Details after Validation to automatically open the new certificate profile once created.
- Click Apply.
The new certificate of deposit displays in the draft portfolio.
Adjustment
Adjustment modes define how the system rolls dates in case of holidays in the calendar.
| Field | Description |
|---|---|
| Unadjusted | Not rolled. |
| Preceding | Rolled to the previous business day. |
| Following | Rolled to the next business day. |
| Modified Preceding | Rolled to the previous business day, only if that day occurs in the same month. Otherwise, rolled to the next business day. |
| Modified Following | Rolled to the next business day, only if that day occurs in the same month. Otherwise, rolled to the previous business day. |
| End of Month (unadjusted) | Rolled to the last day of the month. |
| End of Month (preceding) | Rolled to the last day of the month, then adjusted to the previous business day. |
| Modified Following (year) | Rolled to the next business day, only if that day occurs in the same year. Otherwise, rolled to the previous business day. |