Multi-asset brokerage and clearing specialist Newedge is to join forces with Global Markets Exchange Group International (GMEX Group).
GMEX Group is an exchange business focused on the launch of new products, including differentiated interest rate swap futures contracts, and derivatives indices, as well as exchange business partnerships in emerging markets enabled by multi-asset trading technology.
Newedge UK Financial Limited plans to become a trading and clearing member of Global Markets Exchange Group Limited (GMEX), a wholly-owned subsidiary of GMEX Group, which is expected to go live during the first half of 2014 to operate as a Multilateral Trading Facility (MTF), subject to regulatory approval from the UK Financial Conduct Authority (FCA).
The initial launch is focused on GMEX’s Constant Maturity Futures (CMF) contract, which addresses the complications of hedging interest rates that are associated with the standard quarterly expiring futures contracts. Newedge aims to offer execution and clearing services for this and future GMEX products to its global client base that includes asset managers, hedge funds, sell side banks and futures trading firms.
"With this cooperation, Newedge is supporting innovation in new exchange listed derivatives products, which will enable institutions to reduce balance sheet costs and achieve margining efficiencies," says Chris Topple, global head of prime clearing services at Newedge. "Our market research indicates significant levels of interest in the GMEX exchange platform, not least because it is a timely and relevant response to help meet the G20-led market reforms to reduce systemic risk by moving bi-laterally managed OTC derivatives to transparent electronic trading venues supported by central counterparty clearing houses."
“We welcome this collaboration with such a key global derivatives prime broker to support our international growth, development and distribution. We look forward to working closely with Newedge as a trading and clearing member of the GMEX exchange, to the benefit of buy side, sell side and futures trading firms across the world,” says Hirander Misra, chief executive and co-founder of GMEX Group.