From 25 February, Singapore Exchange (SGX) is providing international customers the choice of clearing OTC transactions as swaps or futures contracts, broadening access to Asian OTC commodity and financial derivatives markets.
SGX AsiaClear will offer a suite of futures contracts called AsiaClear Futures, starting with Iron Ore, Freight and Oil, which is fully fungible with bilateral swaps currently cleared by the exchange.
International customers, including US customers, will be able to meet their risk management needs with swaps and/or futures in SGX AsiaClear. With an open and robust clearing infrastructure for fully fungible products, the convergence of liquidity in a single clearing venue averts price fragmentation and promotes secure and efficient risk transfer.
SGX AsiaClear intends to expand its clearing services from the current commodity and financial products to Asian OTC equity derivatives as customer needs develop.
John Banaszkiewicz, managing director of Freight Investor Services (FIS), a leading broker in global commodities, said: “FIS has always been a passionate advocate of bringing new products and trading opportunities to the market. We welcome SGX's move to facilitate customers from different jurisdictions to continue to trade and tap on its fast growing liquidity pool in Iron Ore swaps and other products.”
