Market
OTC
Direct negotiation between agents
Term Certificates are agreements on buying and selling of an asset on a future date, for a previously set price. These agreements are private and are established between two financial agents.
One of the parties takes on the buying position in the contract on term for a specific date and at an agreed set price. The other takes on the selling position in equal terms.
The price of a Term Certificate is established on the basis of at sight price plus the expected interest rates, fixed freely on the market, by the term of the contract, being the broker able to request an additional guarantee from its clients, on top of the cash deposit in the stock exchange.
There are three types of Term operations:
Simple fixed term
It consists on buying and selling for settlement on a future date; the buyer and the seller agree upon the quotation and the maturity of the deal. The buyer hands in the payable amount and receives the assets;
In installment debt with a premium
It is a previously agreed operation fixed on the basis that one of the parties may give up upon the payment of a previously fixed premium;
Report / Deport
The Report operation means buying assets at cash price and selling simultaneously in installment debt, which is the equivalent of a credit concession at prefixed rates.
The Deport operation is the sale of assets at cash price and buying these assets simultaneously in installment debt, which is the equivalent of borrowing money at pre fixed rates.