Comment Letter to the CFTC on its Proposed Core Principles and Other Requirements for Swap Execution Facilities

March 08, 2011

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Topics: Commodity Futures Trading Commission CFTC, swap execution facilities, SEFs, SEF trading platforms, regulatory efficiencies, market efficiencies, market-based competition, transparency, real-time public reporting of swap transaction data, available for trading, competition, grandfather relief, request for quote, RFQ, order book, cleared swaps, block trades, timing delay, required transactions, Designated Contract Market, DCM, Mandatory Execution Requirement, annual review, market liquidity, minimum block threshold, large notional transaction size threshold, reporting requirements, recordkeeping requirements, daily trading records requirements, major swap participants, CEA, RFQ system, Over-the-Counter, OTC, electronic platform, one-to-one voice services, mandatory objective criteria, mandatory transparent criteria, OTC market, connectivity, grace period, liquidity, resting bids, swap data repositories, liquidity characteristics, bilateral trading environment, trading venues, dealer-to-customer platforms, exchanges, swap execution, bilateral trading, voice-based trading, flexibility, execution protocol, order book systems, multiple-to-multiple trading venues, limit order, central limit order variants, non-continuous liquidity, credit default swaps, responsive quote, interstate commerce, mandatory minimum required recipients, quote requesters, institutional investors, voice-based system, security-based swap execution facility, SB SEF, permitted transactions, block trade thresholds, block size, data analysis, minimum block sizes, joint the trade, auction-based methods, matching, fixing, open outcry trading pits, quote-requesting participant, widened bid/offer spreads, exchanges for physical, exchanges for swaps, off-market transactions, linked transactions, packaged transactions, single joint transactions, crossing, matching traders, futures position, physical position, cash position, debt instrument, physical contract, discreet contract, Manipulation, price distortion, congestion, sporadic liquidity, emergency procedure, public information, complete audit trail, conflicts of interest, chief compliance officer, ISDA, SIFMA, Over-the-Counter Derivatives Markets, CBOE futures exchange, RFQ response period, Rulebook,
From: MFA, Stuart Kaswell

To:

David Stawick, CFTC
Gary Gensler, Michael Dunn, Bart Chilton, Jill Sommers, Scott O'Malia, (all) CTFC.

MFA submitted a comment letter to the CFTC on its proposed Core Principles and Other Requirements for Swap Execution Facilities. In our letter, MFA: (i) recommended that the CFTC apply approved objective, transparent criteria to determine when a SEF can make a swap available to trade; (ii) requested that the CFTC expand temporary grandfather relief for venues seeking to become SEFs; (iii) supported permitting SEFs to use both request for quote and order book systems, but encouraged the CFTC to permit the minimum number of recipients to whom a quote-requesting market participant must send an RFQ to be as low as one; and (iv) commented on the fifteen-second timing delay required for crossing and matching of trades.

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