Reuters- IDX Capital
launches CDS trading in U.S.
IDX Capital on Tuesday went live with
its new electronic credit derivatives
trading platform, that facilitates trades
between eight of the major derivatives
dealers.
The platform offers three innovations
to the rapidly growing credit derivatives
market. One side of the trade is charged
a commission, which he said has never
been done before.
Second, IDX offers an electronic platform
that features live executable prices,
Hunter said. This has never been done
before with other systems showing only
indications of potential prices, he said.
Third, the IDX platform offers a hybrid
system whereby users have access to the
market via the electronic platform while
still executing trading over the phone
with a live broker.
IDX will move to all-electronic trading
in certain instruments when market participants
seem ready to abandon voice trading, which
is still the norm in the derivatives market.
IDX does not charge market participants
who post prices a commission. IDX only
charges the participant that takes the
offered price. This rule applies whether
the initial offer is to buy or sell protection.
IDX launched on Tuesday with trading
of only high-grade single-name CDS contracts.
IDX will expand into London and Asia
in 2006, and start offering trading in
index, structured products, and high-yield
names next year as well.
