As volatility spiked with the covid-19-induced asset-price dip in March, investors took many more trades for central clearing than usual. In PostTrade 360° Amsterdam, LCH’s Petra Verhulst and Heiko Cassens summed up their experience.
[This is an update, now with the video, of the original news post from the conference day, 28 October.]
“2020 was an unprecedented year in terms of the volatility levels we’ve seen,” says Heiko Cassens, quoting over 650,000 trades on LCH’s Swapclear service in the first quarter, to compare with under 500,000 even in busy quarters normally, such as the last quarter of 2019. In dollar volumes the trade was up 75 percent.
“I think the impressive story there is that there was no interruption to the service. So it all worked very well, although all of us were working from home environment – which currently looks like the new normal for financial markets. So the clearing market infrastructure, I have to say, has turned out to be very, very robust.”
At September’s PostTrade 360° Copenhagen, Heiko Cassens took part in a similar session together with SEB’s Gabriel Vimberg – a session published in full as video here. There, he observed that the crisis had made many market participants more interested in the details of their collateral margin management.
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