GlobeOp Financial Services is launching its GoOTC service as a standalone outsourced package for over-the-counter (OTC) derivative trade processing. Previously only available as part of GlobeOp’s integrated middle- and back-office service, the GoOTC package is now available to the widening investment community trading in OTC derivatives.
“Hedge funds and institutional investors are increasingly finding that their derivatives processing systems, many of which are based on Excel spreadsheets, are reaching capacity or are too cumbersome to be effective,” said Ron Tannenbaum, GlobeOp head of sales and marketing. “Hedge fund managers — and mutual funds affected by the European UCITS lll legislation — looking to preserve or increase returns are often unable to enter the OTC derivatives market quickly because they lack an efficient in-house processing platform. Our GoOTC service provides a highly automated, ‘plug and play’ middle-back office solution for valuations, reconciliations, collateral management and payments. It’s an example of our history of technological innovation and adaptability in meeting client needs. GlobeOp now values 61 distinct OTC derivatives each day and processes over 1,300 OTC derivatives trades daily."
In a survey released this month by the Bank for International Settlements (BIS) in Basel, Switzerland, in the past year the global derivatives market grew at the fastest pace in at least nine years. In 2006, the total amount of over-the-counter contracts rose 39.5 percent to
$415 trillion (€308 trillion), the largest increase since the BIS began compiling the data.
Tannenbaum added that the scope of derivative instruments valued by GoOTC is also a timely response to European UCITS lll regulations requiring accurate, verifiable and independent daily valuation of OTC derivative instruments.
