Forward Contracts mimic the cashflow of the underlying instruments. Therefore KODIAK Derivatives needs to generate the correct cashflows for all forward contracts. For contracts with underlying bonds, the system needs to generate and attach all interest payments to the correct forward contracts. For contracts with underlying shares, the system needs to generate and attach all dividend payments to the correct forward contracts.
Interest Payments
Dividend Payments
Dividend payments are added to forward contracts in two steps.
- First they are entered into a Back Office Interface that saves them to a database table.
- After the dividend payments are inserted into the database, the same job that insert interest payments on bond contracts picks them up and adds them to all open contracts with that particular underlying share.
Back office interface
Payments Job
The payments job has two roles. Firstly to attach interest payments to contracts with underlying bonds and secondly to attach dividend payments to contracts with underlying shares.
Attaching dividend payments
The job goes through all enabled dividend payments