Over the counter derivative markets allow Inter Dealer Brokers(IDBs) to offer complex derivative products usually not listed on an exchange. These IDBs can offer market entry to traders providing the opportunity to reach a large liquidity pool for hedging or physical delivery of commodity based products. In this current economic climate, the risk of counterparty default on OTC transactions is a concern for any organization wishing to take a position in the OTC markets. Trayport's GlobalVision Broker Trading System, a market leading trading platform in the OTC energy space, provides the ability to define bilateral credit between trusted counterparties for any derivative based transaction in real time.
Using the GlobalVision Trading AgreementsSM application, brokers can define bilateral agreements between any of their trading counterparties and clearing memberships. Any open interest created in this marketplace will have been verified pre-trade, providing the confidence to market participants that any position has been filled by a predefined trusted bilateral relationship.
Trayport's Broker Trading System facilitates growth into new markets where mature relationships are not present by providing sleeving technology to quickly identify third parties that can sleeve a derivative trade for a smaller institution with limited credit status, thereby extending and strengthening the overall liquidity pool.