LCH Announces Plans to Clear on Goldman Sachs' SIGMA X MTF in July

Leading multi-asset class Clearing House Clearing House A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e Read this Term LCH Ltd announced today that it will begin clearing on Goldman Sachs' SIGMA X MTF starting in July this year, which will enable LCH’s EquityClear service to offer clearing across 17 inter-operable equities trading venues within Europe, as per a company statement regarding the plans.

Goldman Sachs’ Head of Market Structure for EMEA Equities, David Shrimpton - who previously served as COO for SIGMA X MTF - commented in the announcement: “We continue to enhance SIGMA X MTF to meet the future needs of our clients and trading participants as the equities trading model evolves ahead of MiFID II implementation."

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Mr. Shrimpton added: "Interoperability is a key part of the post-trade market infrastructure and we’re pleased to offer a choice of CCPs for SIGMA X MTF."

As a result of the planned expansion, users of multiple trading venues will be able to concentrate their trading activity through one clearing house, which LCH highlighted in its announcement regarding the news.

The news follows after LCH made some recent appointments to help bolster its FX team, as reported by Finance Magnates at the end of last month. LCH.Clearnet and its related brands fall under LCH group in the UK, which is owned in the majority by the London Stock Exchange (LSE).

Cécile Nagel, Global Head of Equities and Commodities at LCH, added in the company statement: “This is a real milestone for EquityClear. We’re proud to be clearing for SIGMA X MTF and this latest addition builds on the significant extension of market and venue coverage we’ve achieved in the past 18 months."

Mrs. Nagel added: "Open access is at the heart of LCH’s business model and our equities clearing members can benefit from further cost and operational efficiency as well as improved Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term by consolidating their activity into one CCP.”

Year-over-year, LCH saw an uptick as 30% of its volumes increased compared to Q1 2015, and the increase was partly attributed to a trend of clearing members consolidating their cash equities clearing through a single central counterparty (CCP) – in addition to recent venues that were added which helped lift volumes during Q1 2016.