Consists of three separate components: (i) The price return on an underlying asset. If the asset increases in value, then Party A pays Party B the magnitude difference between original and final asset prices. If the asset decreases in value, then Party B pays Party A the magnitude difference between original and final asset prices. (ii) Dividends. If any dividends are paid on the asset, then Party A pays a cash amount to Party B equivalent to the dividend value. (iii) A funding cost, usually LIBOR or some fixed rate, paid periodically by Party B to Party A .