What does plain vanilla mean?

Definition of plain-vanilla : lacking special features or qualities : basic.

How do you use plain vanilla?

plain vanilla

  1. Completely basic, simple, or straightforward, lacking embellishments, adornments, special features, etc. I still use the plain-vanilla version of the software.
  2. Uninteresting, unexciting, or unadventurous.
  3. Referring to a simple or standard derivative financial instrument, such as an option or a swap.

Who owns plain vanilla?

Vanessa Kenchington
Vanessa Kenchington, founder and proud owner of Plain Vanilla Bakery.

Why is vanilla option called vanilla?

What is a Vanilla Option. A vanilla option is a financial instrument that gives the holder the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a given timeframe. A vanilla option is a call option or put option that has no special or unusual features.

What is plain vanilla swap?

The term plain vanilla swap is most commonly used to describe an interest rate swap in which a floating interest rate is exchanged for a fixed rate or vice versa.

Does vanilla mean boring?

Vanilla is the most common flavor of ice cream. This word has another, slightly insulting, meaning: a vanilla movie is plain and kind of boring. A vanilla song is on the blah side. Maybe it’s because vanilla food tends to be white and plain that we use this word for other things that are bland.

Why is it called plain vanilla swap?

The mechanics of a plain vanilla interest rate swap are fairly straightforward and similar to those involving currencies and commodities. In this type of swap, two parties decide to exchange periodic payments with one another according to specified parameters using interest rates as the basis for the agreement.

What is a plain vanilla interest swap?

Plain Vanilla Interest Rate Swap is an agreement between two parties (known as counterparties) where one stream of future interest payments is exchanged for another based on a specified principal amount.

What is a vanilla option?

A vanilla option is a simple call or put option with no special features or observation dates. It gives the holder a time-limited right, but not obligation, to buy or sell an instrument at a predetermined price, in exchange for a premium.

How is plain vanilla swap calculated?

The interest on the floating rate leg is accrued and compounded for six months, while the fixed-rate payment is calculated on a simple 30/360 or 30/365 basis, depending on the currency. The interest due on the floating rate leg is compared with that due on the fixed-rate leg, and only the net difference is paid.

What are the different types of swap?

Interest Rate Swaps.

  • Currency Swaps.
  • Commodity Swaps.
  • Credit Default Swaps.
  • Zero Coupon Swaps.
  • Total Return Swaps.
  • The Bottom Line.
  • When did vanilla mean plain?

    Several crème brûlées and profiteroles later, by the late 1950s, we see plain vanilla as an informal way to describe something as “plain” or “basic”—having no embellishments; no bells and whistles. “This is in allusion to vanilla ice cream, taken as the most basic flavor,” Kelly says.