NEW YORK, NY. December 8, 2014. Javelin SEF, LLC (“Javelin”) announced today that it has launched an anonymous Central Limit Order Book (“CLOB”) for Market Agreed Coupon (“MAC”) swaps clearable on both LCH.Clearnet and CME Group. MAC swaps have gained in popularity since they were created by SIFMA and ISDA over a year ago and are the fastest growing product in the interest rate swap (“IRS”) asset class. MAC swaps are interest rate swap contracts that have pre-defined, market agreed terms, including start and end dates, payment dates, fixed coupons, currencies and maturities.
“We are very pleased to be one of the first swap execution facilities (“SEFs”) to operate an order book for MAC swaps,” said Wally Sullivan, CEO of Javelin. “We expect rule changes around anonymity that will finally encourage CLOB trading to start. For cost and operational reasons we anticipate MAC swaps to be the first product to gain traction via CLOB in the dealer to client market place.”
Javelin’s MAC swap CLOB will be accessible to direct participants of Javelin as well through aggregation platforms such as UBS Neo, and CS Prime. Javelin has commitments from several dedicated electronic market-makers and expects to have a critical mass of liquidity on the platform in the first quarter of 2015.
“With fixed dates and coupons, MAC swaps by design are standardized instruments that promote enhanced liquidity and automatic line-item reduction,” said Michael Koegler, Managing Director of Javelin. “MAC swaps reduce trading costs and are easier to allocate than IRS swaps that are quoted in par rate terms.”
Javelin is one of only three SEFs that have publicly stated that they will offer live, actionable and anonymous prices for MAC swaps via a CLOB.
About Javelin SEF, LLC (www.thejavelin.com)
Javelin SEF, LLC (“Javelin”) is a derivatives execution platform for Interest Rate Swaps. Javelin offers both anonymous electronic and voice-hybrid methodologies for trade execution and works with several execution partners to ensure optimal liquidity for its diverse customer base. Javelin is one of the first platforms to register as a Swap Execution Facility under the Dodd Frank Act with the Commodity Futures Trading Commission.