European stock exchange Euronext has launched a new service allowing over-the-counter trades to be conducted in the same pools as other derivatives positions.
AtomX is designed to allow the efficiency and security of the regulated market to apply to bilaterally negotiated trades, with trades clearing through LCH.Clearnet.
The launch is a response to the regulatory agenda, which calls for more transparency around OTC derivatives, and more mitigation of the risks posed by them. According to Euronext, market participants are also looking for more efficiency in portfolio management.
AtomX addresses this by combining the flexibility of OTC trading with the capital and operational efficiencies of the regulated market. It is also intended to appeal to a broader section of the trading community, meaning more opportunities to develop on-exchange derivatives trading.
Adam Rose, head of financial derivatives at Euronext, said: “Clients are under significant pressure to find capital efficient solutions whilst maintaining much of the flexibility that OTC contracts provide in allowing them to meet their trading objectives.”
“Through this service we can immediately offer efficiencies to clients trading bespoke equity derivatives contracts on our products. In addition we are also in discussions over new products that we can add to the service to bring more benefits to the marketplace.”
