Eurex has signed a licensing agreement with Global Markets and Exchange Group Limited (GMEX), to license its euro-denominated Constant Maturity Future (CMF).
The CMF will be traded will trade via Eurex’s multilateral trade registration service, while Eurex Clearing with provide service and clearing.
Based on the interest rate swap index average (IRSIA), the CMF tracks the interest rate exposure at each point on a yield curve, and marks the contract to market against an IRSIA constant maturity index by removing the expiry date.
The contract also facilitates management of rate exposure without the need to readjust, maintaining the liquidity of a given maturity of 2 to 30 years.
Under the agreement, transactions on the CMF contracts will be arranged on the GMEX trading platform, executed at Eurex Exchange and cleared at Eurex Clearing.
Eurex exchange members will also be able to trade GMEX’s euro-denominated CMF with their current membership, benefiting from existing arrangements and infrastructure.
Brendan Bradley, chief innovation officer and member of the Eurex Executive Board, said: “We are pleased to enter in to this licensing agreement with GMEX, who are taking a highly innovative approach to the market. Our members will benefit from access to a new type of interest swap futures contract via our proven and efficient exchange environment.”
GMEX has also been granted regulatory approval from the FCA in the UK.
Hirander Misra, CEO of GMEX group, said: “We continue to make very good progress with our launch and this new licencing arrangement with Eurex provides firms with a well-established mechanism to trade and clear our CMF contracts. We are getting very strong support from the trading community, particularly the buy-side.”
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