Traiana Connects to Eurex for OTC Interest Rate Swap Clearing

Infrastructure service Traiana announced this Thursday that it has provided direct central clearing connectivity to international exchange Eurex for over-the-counter (OTC) interest rate Swaps Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Swaps can be defined as a derivate contact composed of two parties that exchange to cash flow between two separate financial instruments.They are generally divided into two categories. This includes contingent claims (options) and forward claims, where forward contracts, swaps, and exchange-traded funds (ETFs) are exchanged. Commodity price, equity price, interest rate, and foreign exchange rate are common variables used as one of the cash flows in swaps upon initiation. Different Types of Swaps Read this Term.

Part of the CME Group, Traiana’s infrastructure provides trade life-cycle and Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term solutions. Following today’s announcement, venues, trading parties, and clearing members now have access to an end-to-end clearing solution for OTC interest rate swaps.

Under the agreement, Traiana's Clearing Hub has been connected with Eurex, allowing market participants to submit trades for clearing that have been executed on electronic trading venues, the statement said.

Furthermore, users will have access to Traiana's Credit Risk Hub (LimitHub). Through LimitHub, pre-trade checks for client orders that have been placed on regulated trading venues, as well as post-trade checks for voice executed trades, are available. This is both a requirement in Europe under MiFID II and in the United States under Dodd-Frank.

Commenting on the announcement, Steve French, Head of Connectivity and Messaging, at Traiana said: "This connectivity agreement is well-timed for market participants keen to use our services to consolidate their OTC clearing processes and benefit from an increase in clearing activity at Eurex.”

Demand for Eurex OTC IRD Clearing Services Increases

According to the statement, Traiana has provided this connectivity to Eurex due to an increased demand from market participants to access the exchange’s Clearing OTC IRD clearing services.

In fact, Traiana is not the first infrastructure service to do so. As Finance Magnates reported Eurex Clearing, established a direct connection with Tradeweb Markets, a global provider of fixed income, derivatives and ETF marketplaces, to facilitate the clearing of OTC interest rate products.

"Traiana's clearing services are an essential part of the OTC clearing process and their efficient management of clearing workflows will allow our members and end clients to streamline processing IRS transactions on both a pre and post-trade basis," added Danny Chart, Head of Business Development of Eurex Clearing.