The Fast Track to Central Clearing And Optimal Margin Management (CME Group, Woodbine Associates)

May 2013

KEYWORDS: buy-side firm, capital requirements, Category II clearing mandate, CCP, central clearing, central counterparties, CFTC, clearing, CME Group, collateral, Commodity Futures Trading Commission, FCM, FIA, futures, futures commission merchant, initial margin, ISDA, LSOC, margin, market efficiency, netting, OTC derivatives, portfolio margining, risk management, swaps, UAT, user acceptance testing

Authors:

Sean Owens

Organizations:
  • CME Group, Woodbine Associates

Summary:

Category Two firms must move swiftly to finalize central clearing arrangements before the rapidly approaching June 10th deadline.

Waiting is not an option.

Firms that fail to complete arrangements with FCM, CCP, and vendor partners will not be able to trade swaps. This will restrict trading, hedging, and have a material impact on day-to-day business.

Asset managers must move swiftly and decisively to avoid potential last-minute bottlenecks and complications.

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