Imported from previous forum
In spring 2011, FPL was invited to participate in an effort led by a group of investment banks to jointly engage with existing and emerging fixed income market venues and ISVs to promote increased use of the FIX Protocol and other open standards such as FpML, across the trading life cycle of all fixed-income products.
As Dodd Frank reforms seek to achieve greater market transparency by requiring most types of OTC derivatives to be cleared through clearing houses and traded on Swap Execution Facilities (SEFs), a surge in new market venues is expected within the U.S. Similar reforms are also expected to emerge from the upcoming MiFID II regulations in Europe. Encouraging adoption of FIX by new and existing venues offers market participants significant cost savings and efficiency gains, enabling firms to connect to trading partners in a standardised and cost‐effective manner, minimising the financial implications of market entry and significantly reducing switching costs.
In 2011, the FPL Global Fixed Income Technical Subcommittee worked closely with the group to produce industry best practice recommendations for using FIX to support the trading of Interest Rate Swaps (IRS) and Credit Default Swaps (CDS) in a standardised manner to achieve maximum market-wide benefit. Additionally, a gap analysis was prepared to identify any further functionality needed to ensure FIX can effectively meet the trading needs of these asset classes. This work is currently being completed and market participants will shortly be able to benefit from the best practice recommendations and increased availability of standards in this space.
The group is now ready to commence the next steps in this effort, which will focus on ensuring FIX can support the needs of the cash fixed income markets. This will include the creation of best-practice guidelines and also the identification and development of any additional functionality that needs to be added to the FIX Protocol to support the trading of these asset types.
FPL would like to invite market participants interested in contributing to the cash fixed income initiative to join the FPL Global Fixed Income Technical Subcommittee and participate in the group’s initial meeting taking place on Friday, March 9th at 10am ET / 3pm UK. If you would be interested in taking part and would like to find our more, please contact the FPL Program Office by emailing FPL@fixprotocol.org.