DEFINITION of 'Vanilla Strategy'
An approach to investing or to business decisionmaking that is basic and common. Some investors and businesses excel because they choose an ordinary, vanilla strategy, while others succeed through innovation. In derivatives trading, a vanilla strategy is the use of two different plain vanilla instruments, such as swaps, at the same time.
BREAKING DOWN 'Vanilla Strategy'
For example, a vanilla strategy for retirement saving might include saving at least 10% of one's annual income, investing in diversified portfolio of stocks and bonds through taxadvantaged savings accounts like a 401(k) and Roth IRA, and buying a home with a plan to pay off the mortgage before reaching retirement. There is nothing interesting or unique about this strategy  it is "vanilla" because it is ordinary.

Plain Vanilla
The most basic or standard version of a financial instrument, ... 
Plain Vanilla Swap
The most basic type of forward claim that is traded in the overthecounter ... 
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Asset Swap
Similar in structure to a plain vanilla swap, the key difference ... 
Vanilla Option
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Financial Advisor
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Trading
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Managing Wealth
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The annual report is a yearly publication that public corporations provide to shareholders to describe the company’s operations and financial condition. 
Trading
Managing Interest Rate Risk
Interest rate risk stems from the possibility that an interestbearing asset’s value will change due to changing interest rates.

What is the difference between derivatives and swaps?
Find out more about derivative securities, swaps, examples of derivatives and swaps, and the main difference between derivative ... Read Answer >> 
Do interest rate swaps trade on the open market?
Learn how interest rate swaps are traded on the OTC and interbank markets, and how these swaps can be used to arbitrage different ... Read Answer >> 
Can bond traders trade on interest rate swaps?
Read about interest rate swaps and why these transactions are performed by institutional actors in the bond market, not individual ... Read Answer >> 
What are interest rate swaps on the OTC market?
Learn about interest rate swaps and how they are traded over the counter, and understand the impact of DoddFrank on swaps ... Read Answer >>