Interactive Data Corporation (NYSE: IDC), a leading provider of financial market data, analytics and related services, today announced that its Pricing and Reference Data business has expanded its interest rate swap valuation service by adding 3 p.m. ET valuations, as well as independent valuations for compounding swaps, and certain historical valuations for interest rate and credit default swaps.
Interactive Data's interest rate swap valuation service assists clients by providing information they can use to efficiently value their portfolios containing these over-the-counter (OTC) derivatives. The Company currently offers interest rate swap valuations in six major currencies and estimates that its coverage includes approximately 95% of the total notional amount of interest rate swaps outstanding. The International Swaps and Derivatives Association (ISDA) found that the notional amount of interest rate derivatives outstanding (which include interest rate swaps) rose 34 percent year-over-year to $382.3 trillion at the end of 2007.
"As more investment portfolios contain interest rate swaps, we've expanded the capabilities of our valuation service to respond to client demand for a broad range of independent valuations," said Shant Harootunian, managing director of evaluated services, Interactive Data Pricing and Reference Data. "Our new 3 p.m. interest rate swap valuations are synchronized with the corporate bond evaluations we currently produce, and they complement our end-of-day valuations for this asset class. Accounting firms and hedge fund processors have also identified historical valuations for interest rate and credit default swaps as critical for monitoring client positions, as they need to retrieve valuation levels reflecting the previous end of month. We also added compounding swaps to enable clients to obtain valuations on interest rate swaps with nontraditional structures."
"As investment portfolios become more diverse and complex, there is a heightened need for independent valuations of growing numbers and categories of hard-to-value financial instruments," said Stephen Bruel, analyst, Securities & Capital Markets for TowerGroup. "In addition, we believe that market data providers who can automate the process for delivering valuations for a broad range of OTC derivatives and evaluations on millions of fixed income securities will continue to experience high demand for their products and services."
The interest rate swap valuation service offers user-friendly asset setup screens and the ability to upload trade data and download output files which can help limit the occurrence of manual input errors.