OpenGamma and IHS Markit Team Up on Margin Rules

Margin optimization specialist OpenGamma, today announced its collaboration with London-based Analytics Analytics Analytics may be defined as the detection, analysis, and relay of consequential patterns in data. Analytics also seeks to explain or accurately reflect the relationship between data and effective decision making. In the trading space, analytics are applied in a predictive manner in an attempt to more accurately forecast the price. This predictive model of analytics generally involves the analysis of historical price patterns that are used in an attempt to determine certain price outcomes. Analyt Analytics may be defined as the detection, analysis, and relay of consequential patterns in data. Analytics also seeks to explain or accurately reflect the relationship between data and effective decision making. In the trading space, analytics are applied in a predictive manner in an attempt to more accurately forecast the price. This predictive model of analytics generally involves the analysis of historical price patterns that are used in an attempt to determine certain price outcomes. Analyt Read this Term 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.

The collaboration comes after global regulators introduced a one-year delay to phases five and six of Margin Requirements Margin Requirements A margin requirement is defined as the minimum equity sum that investors must keep in their margin account preceding a trading transaction. Margin requirements may be referred to as maintenance margin, minimum maintenance, or maintenance requirement. This is a requirement for broker trading in any asset class.In terms of equities, the New York Stock Exchange (NYSE) and Financial Industry Regulatory Authority (FINRA) have a fixed margin requirement of 25% of the sum value of the securities presen A margin requirement is defined as the minimum equity sum that investors must keep in their margin account preceding a trading transaction. Margin requirements may be referred to as maintenance margin, minimum maintenance, or maintenance requirement. This is a requirement for broker trading in any asset class.In terms of equities, the New York Stock Exchange (NYSE) and Financial Industry Regulatory Authority (FINRA) have a fixed margin requirement of 25% of the sum value of the securities presen Read this Term 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.