SuperDerivatives responds to ESMA chairman’s comments on exchange trading
Zohar Hod, Head of Americas at SuperDerivatives (SD), the derivatives benchmark and leading multi-asset front office system, has responded to comments made by European Securities and Markets Authority (ESMA) chairman Steven Maijoor at last week’s International Derivatives and Swaps Association conference in Prague.
Hod said: "We welcome Mr. Maijoor’s comments. We host one of the most actively used derivatives management systems in the financial markets, which gives us a unique insight to how they are used and traded.
“Conceptually the notion of a central clearing house for all derivatives trades is the logical next step to instilling transparency and liquidity in the industry. However, in practice the investment required in the people and infrastructure required to efficiently handle bespoke complex derivatives still remains a significant barrier to progress.
“It has long been clear to us that markets need the flexibility which bespoke derivatives instruments deliver. Regulations that limit flexibility impair organisations’ ability to hedge effectively, and could therefore have an adverse effect on the market.
“Legislation to bring greater oversight to the OTC derivatives market must take into account the differences between the various products used and their specific functions and ensure the investment in the necessary resources is made prior to any legislative change.
"It is encouraging to hear this realisation openly expressed by Mr. Maijoor.”