FMDQ Clear, through its efficient systems, manages cash and non-cash collateral for covering margin requirements for transactions in a manner that delivers capital efficiency for market participants. Accordingly, non-cash collaterals, for instance, which are posted for this purpose are valued daily using market prices, taking into account applicable allowances for the liquidity risk of each collateral and pending transactions; and is then evaluated to ensure the collateral value is sufficient to cover the participant’s margin requirement(s).
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Services
FMDQ Clear offers clearing, clearing risk management, collateral management, settlement processing and reporting for products cleared through its platform.
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Clearing
At FMDQ Clear, we efficiently match, confirm and aggregate transactions across market participants and trading venues on a near-real time basis. Our clearing activities reduces operational risks for market participants through our integrated clearing system that delivers straight-through-processing between the trading Systems and Settlement Systems.
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Clearing Risk Management
In order to ensure certainty & finality of settlement, and the safety of transactions that occur on FMDQ Exchange platform, FMDQ Clear, as part of its risk management process, administers initial and variation margins from transaction counterparties. These margins, collected in form of cash or eligible securities, cater for the likely risk which may arise from future adverse movement of prices of open contracts or traded securities.
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Collateral Management
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Settlement Processing
Through integration with other financial systems payment infrastructure, FMDQ Clear facilitates the settlement of cash deliverable derivatives executed on the FMDQ Exchange platform. This seamless process ensures that participants receive value for executed contracts on settlement dates further minimising the likelihood of counterparty risks which may be triggered by operational failures arising from the Members.
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Reporting
FMDQ Clear provides activity-based reports on its clearing, risk management, settlement & collateral management services to foster market transparency. These reports are provisioned via a combination of real-time online data/analytics and on-demand by market participants.