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Home » Analytics » International Derivatives Clearing House, SwapsClear, and Jefferies

International Derivatives Clearing House, SwapsClear, and Jefferies


Ryan Davidson, Risk, 2009, Building a new house, here. Story’s looking legit.

In terms of how the platform works, market participants trade interest rate swap contracts bilaterally as normal, and then
replace them with economically identical futures contracts via an exchange of futures for swaps on IDCG’s website, www. These contracts are then cleared and settled through IDCH. Unlike the competition to clear credit derivatives, there are already a couple of established players in the interest rates arena. London-based clearing house LCH.Clearnet has run its SwapClear service since 1999, which it claims clears approximately 50% of the global interbank market for swaps. Meanwhile, Chicago-based derivatives exchange CME Group launched its CME Cleared Swaps platform in July 2008.
According to Edmonds, the founders of IDCG saw a gap in the rates clearing market for a service that would better complement existing trading practices for interest rate swaps than the rival offerings. “IDCH’s interest rate futures are completely fungible with what is traded in the OTC market-place. This was one of our goals for the project, so firms do not have to alter their trading behaviour at all,” says Edmonds. “To date, other attempts to transform OTC swaps into futures have not retained the same degree of granularity that our product offering does. These attempts to force the market from the specific to the generic, and to shift the point of price discovery and liquidity, have had a significant influence on their success.”

LCH.Clearnet, SwapClear, here. These folks took over IDCH  from the looks of the website.

When it comes to clearing OTC interest rate swaps, not all services are created equal. The SwapClear offering is the only truly global service and the market leader in OTC interest rate swaps. It’s also the only platform backed by the safety, security and reliability of the world’s leading clearing house group, LCH.Clearnet.

Zerohedge, Jefferies’ Epic Plunge In Bond Trading Revenues Shows Not All Is Well, here.


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