Date

23 Aug 2021

Attendees

Agenda

1) Use Case reminder

2) Where we are on our road map.

3) Open Action Items

4) JIRA Issues Review - https://jira.edmcouncil.org/projects/SEC/issues/SEC-7?filter=allopenissues

5) Todays content discussion.

SMIF OWL-UML

SKOS

RDF/S

6) For next week.

Proceedings:

Today we discussed some issues Pete raised over the weekend with respect to rehypothecation. References include: https://jollycontrarian.com/index.php?title=Rehypothecation, https://www.law.cornell.edu/cfr/text/17/240.15c2-1, https://www.sec.gov/news/press-release/2020-212, https://goldsilver.com/blog/what-is-gold-hypothecation-and-rehypothecation/, and notes:

From that last article, we should ensure we model the difference between allocated (vs pooled) precious metals. Again a big factor related to exposure.
This is quite topical - there is a community of silver backs who distrust paper silver and are insisting on allocated silver or physical coins/bullion.

PS another omission we seem to have is "prime broker". Which is probably a synonym or subclass of something we already have.

Rehypothecation involves process details that we have not yet modeled in FIBO, so there may be some more basic work required in order to model rehypothecation.

We also looked at the CFI standard again this morning, and specifically at section 6.2.8, which talks about structured instruments. Those mentioned appear to be low exercise price option (LEPO)s, or strategies that combine various sorts of options including LEPOs, which are an exotic equity option available outside of the U.S. They can be exchange-traded in some countries, so we do need to include them under equity options, but they appear to be oddly classified in the CFI under equities rather than options, likely because their performance in some cases tracks the performance of the underlying equity or index. See DER-106 for more information on this particular issue as well as https://en.wikipedia.org/wiki/Low_Exercise_Price_Option.

We also looked at Depositary Receipts, and are apparently missing some definitions for a variation in China, which is not a depositary receipt on a share, but on a specific kind of legal entity - see https://en.wikipedia.org/wiki/Variable_interest_entity, which may require us to revise the definitions for depositary receipt in order to accommodate them.

Decisions:

Action items

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