In response to the industry requirement for increased multi-asset processing efficiencies, Broadridge Financial Solutions (NYSE:BR) today announced that it is introducing new processing capabilities for contracts for difference instruments (CFDs), extending the range of business functionality available through its international transaction processing solution, Gloss.
Gloss is extensively proven as a leading international processing solution for equities, fixed income and warrants, plus a growing range of treasury and derivative instruments. This latest investment in CFD processing functionality follows the recently-announced addition of FX forwards, non-deliverable forwards (NDFs) and forward rate agreements (FRAs) to Gloss, and forms part of a substantial investment programme that includes the continued broadening of the Gloss solution's instrument coverage.
International banks and brokerage firms taking advantage of Broadridge's investment in CFD processing on Gloss will benefit from a full suite of agency and principal transaction processing and position keeping for equity, FX, index and interest rate CFDs, including exchange-traded CFDs. Opening and closing events in the CFD lifecycle will be supported with close-out on a FIFO basis. Initial margin (cash or securities) deposited on open and returned on close-out will be supported with full settlement processing. Trading profit and loss can be calculated in real time, with variation margin based on mark-to-market of open trades and the daily financing charge calculated at end of day. The impact of the most commonly encountered corporate actions on CFD positions will also be automated. This new CFD functionality will be available on general release, via outsourcing or on-site basis, by the summer of 2011.
"This is the latest step in our response to the requirement to process many different asset classes on a single platform, as well as a reflection of the demands and activity in our client base at the moment," said Robin Kneale, Head of Strategy & Product Management, Securities Processing Solutions International, Broadridge. "We are pleased to demonstrate the flexibility and configurability of the Gloss engine in this way to meet the markets' evolving requirements. Now we plan to go on to provide functionality for exchange-traded futures and options."