11/01/2011
By Laura Blows
Clearing house group LCH.Clearnet and pan-European equities exchange Chi-X Europe has launched the world’s first contract-for-difference (CFD) clearing service for institutional investors.
The centrally cleared CFD (ccCFD) service will enable institutional investors to source best execution from the broker of their choice and transform this into an on-exchange centrally cleared CFD.
According to LCH, the service complements regulators’ stated aims to increase the proportion of OTC trades cleared and provides additional choice to institutional investors concerned about counterparty risk or regulatory developments.
Wayne Eagle, director of EquityClear says: “For the first time fund managers have access to an on-exchange, centrally cleared cfd to hedge positions and benefit from better risk management tools.”
The ccCFD contract has been developed by LCH.Clearnet and is accessed through Chi-X Europe’s ccCFD service. It initially covers UK blue chip equities, but will be extended to include continental European and further UK equities at a later stage.
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