The London Stock Exchange is to debut its new post-trade routing technology X-TRM as it launches a Central Counterparty (CCP) service for trading in the 50 most liquid Depositary Receipts (DRs) on the LSE's International Order Book (IOB).The X-TRM router will be used in the UK market for the first time as part of the service, to ensure that trades are routed from the IOB to the CCP service provider LCH.Clearnet without manual intervention.
LCH.Clearnet will also offer firms the option of netting transactions in the same securities on the same day, in order to reduce transaction management costs and the firm's financial exposure at settlement level.
Martin Graham, LSE director of equity markets, says the use of the X-TRM post trade router "is a first step in using the Group's post-trade assets to help shape the creation of a wider European trading network linked by shared technology platforms and processes".
The introduction of CCP clearing is also expected to bring wider benefits, by pulling in new market participants and increasing the attractiveness of the EDX London IOB derivatives service.
Graham says five member firms that have not previously traded on the IOB now plan to use the service as a result of the new CCP provision.
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