Buyside traders who execute on or at swap execution facilities (SEFs) are about to get better tools to evaluate their trading costs.
Traiana, a provider of pre-trade risk and post-trade processing solutions, has launched an enhanced version of its CreditLink TCA system with new functionality designed for the buyside. The enhanced version includes services to streamline post-trade processing of SEF trades, manage the allocations process for bunched orders, and the ability to monitor limits across the entire trade lifecycle.
The need for an updated system is rooted in recent changes to the SEF marketplace that mandate the use of new processes for executing, clearing and allocating swaps – all of which can add complexity to traders, middle office and risk managers’ workflows.
CFTC regulations now require that a clearing member define limits and must carry out pre-trade credit checks on clients’ orders prior to execution on SEFs. To assist clients in meeting these regulatory requirements, CreditLink acts as a centralized hub and provides trading platforms, clearers/prime brokers, executing banks and clearing clients the ability to monitor and manage pre- and post-trade credit in real-time across trading venues in a consolidated view.
The updated release of CreditLink, now in full production includes:
– Real-time notifications of SEF orders and executions
– What-if checking for new trades and allocations to ensure planned trading activities are within clearing limits
– Bunched-order allocations with integration to leading clearinghouses across Interest Rate Swaps and Credit Default Swaps
– Automated notifications, alerts and reports to help firms manage their margin requirements and limits with their futures commissions merchants (FCMs)
CreditLink has acted as the pre-trade credit-checking hub for electronic credit default swap (CDS) and interest rate swap trading since the introduction of mandatory SEF trading in February.