Other termination events that can be added to the calendar include a credit degradation below a certain level. A credit support annex (CSA) sometimes accompanies the Master. The CSA allows both parties to reduce their credit risk by setting the conditions under which they must deposit collateral with each other. The most common type of credit derivative transactions is a credit risk swap (CDS). This is a transaction between two parties based on the solvency of a third party, the so-called reference company. This unit of reference may be a business, sovereign, municipality or similar organization and must not be involved in the transaction or be aware of the transaction. Indeed, the ISDA Framework Agreement is a framework agreement that defines the general conditions between parties wishing to trade OTC derivatives. There are two main versions that are still widely used on the market: the 1992 ISDA Framework Agreement (Multicurrency – Cross Border) and the 2002 Isda Framework Agreement. An ISDA framework contract is the standard document used regularly to regulate derivative trading transactions. The agreement, published by the International Swaps and Derivatives Association (ISDA), outlines the terms applicable to a derivatives transaction between two parties, typically a derivatives dealer and a counterparty.
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