Derivatives clearing and settlement: a comparison of central counterparties and alternative structures
AbstractMost exchange-traded and some over-the-counter (OTC) derivatives are cleared and settled through clearinghouses that function as central counterparties (CCPs). Most OTC derivatives are settled bilaterally. This article discusses how these alternative mechanisms affect the functioning of derivatives markets and describes some of the advantages and disadvantages of each.
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Bibliographic InfoArticle provided by Federal Reserve Bank of Chicago in its journal Economic Perspectives.
Volume (Year): (2006)
Issue (Month): Q IV ()
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bliss, Robert R. & Kaufman, George G., 2006. "Derivatives and systemic risk: Netting, collateral, and closeout," Journal of Financial Stability, Elsevier, vol. 2(1), pages 55-70, April.
- James T. Moser, 1998. "Contracting innovations and the evolution of clearing and settlement methods at futures exchanges," Working Paper Series WP-98-26, Federal Reserve Bank of Chicago.
- Michael H. Moskow, 2006. "Public policy and central counterparty clearing," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q IV, pages 46-50.
- Randall S. Kroszner, 1999. "Can the Financial Markets Privately Regulate Risk? The Development of Derivatives Clearing Houses and Recent Over-the Counter Innovations," CRSP working papers 493, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Peter Gomber & Peter Rohr & Uwe Schweickert, 2008. "Sports betting as a new asset class—current market organization and options for development," Financial Markets and Portfolio Management, Springer, vol. 22(2), pages 169-192, June.
- Elisabeth Ledrut & Christian Upper, 2007. "Changing post-trading arrangements for OTC derivatives," BIS Quarterly Review, Bank for International Settlements, December.
- Albert J. Menkveld & Emiliano Pagnotta & Marius A. Zoican, 2013. "Central Clearing and Asset Prices," Tinbergen Institute Discussion Papers 13-181/IV/DSF67, Tinbergen Institute.
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