TRADE NON-DELIVERABLE FORWARDS

NDF Matching

The launch of NDF Matching brings together the benefits of an NDF central limit order book and clearing to offer a unique solution for the global foreign exchange market. Benefit from counterparty diversity and reduced complexity as you execute your NDF foreign exchange requirements. 

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Overview

LSEG’s new NDF Matching venue supports the demand for NDF central limit order book market infrastructure in Asia and around the globe, including from LSEG’s network of over 5,000 FX trading desktop users in the region. It also brings to market a trading platform on which a broader array of market participants can decide to clear their NDFs on a pre-trade basis.

Why choose NDF Matching?

As part of our venue streamlining initiative, we have launched a new NDF capability on the CLOB. Unlike existing services, all trades executed on the venue are submitted to LCH ForexClear for clearing. With LCH ForexClear acting as the Central Counterparty (CCP), it removes the necessity to have a centralised or bilateral credit model.

The integration of clearing into NDF Matching enables easier access to the full book of liquidity in the venue for all participants and better transparency of the market. Cleared settlement brings innovation to the FX market, including simplified credit management, lower costs, and easier adoption by non-bank participants.

We believe that a fully cleared venue for NDFs will open up the opportunity for more participants to access the venue. A more diverse range of participants will change the liquidity profile and have a positive impact on the market, benefiting not just our customers but the market as a whole.

Features and benefits

NDF Matching builds on the strengths of Matching with the addition of enhanced clearing capabilities

  • Genuine all-to-all market (everyone sees the same liquidity)
  • Single credit value to be maintained within venue
  • Margin savings and capital benefits of clearing
  • Visible creation of a “cleared price” which enables better understanding of front-to-back trading costs
  • Availability in two jurisdictions: RMO (and SEF to be launched in February 2024)
Our FX Venues Replatforming initiative

The launch of NDF Matching is the first phase of our replatforming initiative, which sees the migration of our FX venues onto our common core technology platform. This will provide customers with better performance and improved functionality, and support increased product innovation. 

How it works?

How NDF Matching and Clearing works

  • Counterparties execute trades, which are matched on the NDF Matching platform
  • Matching engine performs pre-trade credit check on limits for members or prescribed by clearing brokers (for clients)
  • Trades are submitted directly to LCH ForexClear for clearing
  • Messaging is sent back to clearing brokers and counterparties upon successful trade registration
  • Counterparties and clearing brokers also receive clearing details via the venue post trade API or through Trade Notification

Note: Direct members will have a direct connection to LCH ForexClear without going through a Clearing Broker.

[Yesterday 15:38] Nadar, Viknesh Diagram shows a schematic of how NDF Matching connects with counterparties, clearing brokers and LCH ForexClear

Access options

Access NDF Matching via API or through Workspace

Via API

  • APIs for NDF Matching will be FIX based and consistent across all LSEG FX venues as they migrate
  • API Connections are available for:
    - Market Data
    - Trading
    - Post Trade (Drop Copy or RTN)
    - Credit limits (REST API)
    - Reporting (REST API)
  •  Primary Binary Multicast Feed available for co-lo connections in SG1

Via GUI

Accessed exclusively through our new FX trading desktop, LSEG Workspace, which is available to install now

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