FMDQ Exchange launches derivatives market

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FMDQ Group Plc has unveiled its Exchange-Traded Derivatives Market, to enable investors to hedge their inherent financial market risks.

“Driven by FMDQ Securities Exchange Limited , Nigeria’s largest Exchange by turnover, in collaboration with FMDQ Clear Limited , Nigeria’s foremost CCP, the FMDQ ETD Market, boasts of participation from 10 pioneer Deposit Money Banks and five pioneer non-bank financial institutions, all positioned to change the landscape of the Nigerian financial markets in the near-to-medium term.”

According to the Exchange, with the CCP’s extensive risk management structures and robust financial resources – c. $20m in FMDQ Clear’s proprietary Default Resolution Reserve, and over $12m from members’ contributions to the CCP’s default waterfall, the players would be able to leverage the financial capacity of the very big players in a market structure that transferred counterparty risks to a credible world-class CCP, FMDQ Clear.

It said in support of the ETD Market, the three pioneer General Clearing Members – Access Bank Plc, Zenith Bank Plc, and Stanbic IBTC Bank Plc who are capable of clearing transactions for their proprietary positions and those of other Trading Members and clients, would share mutualised responsibility as members of the CCP, and clear their proprietary positions, as well as 12 Derivatives Trading Members, bringing the pioneer Trading Members in the ETD Market to 15.

 

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