NYFIX, a trading technology provider, is to use SIX x-clear as the central counterparty (CCP) for its Euro Millennium dark pool.
Speaking to theTRADEnews.com, Chris Smith, head of business development, Euro Millennium and international director at NYFIX, said, “As the volumes in Euro Millennium grow, combined with a turbulent market, having a clearing partner that can take on risk and is trusted by our participants is a very important factor.”
The solution will be offered in conjunction with BNP Paribas, which already provides settlement services for Euro Millennium.
Euro Millennium chose its clearing provider following an exhaustive search of pan-European CCPs, according to Smith. He said SIX x-clear had a number of attractive features that influenced the choice. “They are big supporters of the EU code of conduct on interoperability and we are aware of the work they are doing with the London Stock Exchange to try and get competitive clearing for London,” said Smith. “These factors made them the best choice at this time. However, this is not to say that in time, we might not look at a multi-CCP model.”
NYFIX claims the solution will further reduce post-trade costs and risks by providing a netting service and a real-time risk management system to ensure that all positions are continuously monitored and assessed. The netting service will create a single trade for settlement that combines all of the trades that have been done with a given counterparty for a particular International Securities Identifying Number (ISIN). Settlement for each security will be in the principal place of settlement liquidity for the stock, allowing the interchangeability of settlement between Euro Millennium and other trading venues. The solution is expected to be available by the end of 2008.