Margin optimization specialist OpenGamma, today announced its collaboration with London-based analytics provider IHS Markit, to help mutual clients reduce the cost of margin management. The offering will unite OpenGamma’s pre-trade margin analytics with IHS Markit’s post-trade derivatives calculation service, providing end-to-end support for in-scope entities.
According to the announcement, the post-trade calculations extend from IHS Markit’s Portfolio Valuations business, as well as CDS pricing and bank consensus data for illiquid derivatives.
When combined with OpenGamma’s strength in margin analytics for cleared and bilateral derivatives, mutual clients can fully manage pre- and post-trade requirements through a single solution with flexible delivery options.
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The collaboration comes after global regulators introduced a one-year delay to phases five and six of margin requirements for non-centrally cleared derivatives, more commonly known as Uncleared Margin Rules (UMR). The final two phases of UMR, scheduled for September 2021 and September 2022, respectively, will bring into scope numerous institutional asset managers, creating an increased demand for tools that help reduce the cost of posting margin.
Enabling cost mitigation
“Together with OpenGamma, we are excited to help firms achieve regulatory compliance and a competitive edge through margin validation and optimisation,” said Hiroshi Tanase, executive director at IHS Markit. “Our forward-looking solution, powered by highly-accurate margin analytics and calculations, can effectively streamline margin workflows and OTC derivatives trading to enable cost mitigation.”
“Asset managers are currently working out how to best use the time afforded to them by the UMR delay. Many firms are underestimating the complexity involved in pricing bilateral derivatives. IHS Markit is one of the very few firms that has the proven pedigree in this area. Together, our combined solution offers full coverage for both cleared and bilateral derivatives,” Peter Rippon, CEO of OpenGamma, added.