Essentials

Once received trades are validated in the LCH clearing system, LCH becomes the Central Counterparty. Trades are registered and enriched with details to be cleared and processed in line with the member’s preferences in real time.

Once created, positions are maintained in real time. Position adjustments can be made by Clearing Members (offsetting, Internal / external position transfers) in intraday or during the overnight process when exercises/assignments, abandoned are processed.

For further details on clearing functionalities, please contact our Customer and Success Management team and request for the Service Description document

Instruments referential and market data are maintained and provided by GFO-X.

• The market data are sent to LCH several times a day and at the end of day for position and margin management purpose.
• The instrument referential for business day D is provided by GFO-X at the end of the previous business day.

Instrument referential and market data reports are made available to Clearing Members on LCH’s Portal.

Future and option contracts are settled exclusively via cash flows and through daily Variation Margin (adjusted on expiry date).

The calculation of Core Initial Margins relies on a method designed specifically for the service, known as the Excepted Shortfall/VaR (Value at Risk) method.

Risk offsets are managed at Margin Account level, providing accurate position analysis and margins.

Margins are calculated at the end of the day as well as intraday based on the last updated positions and market data.

LCH DigitalAssetClear, through a well-established and proven process, manages members’ defaults.

More details on Risk Management here.

Clearing Members can handle the management of their collateral flows via CMS (Collateral Management System) available on LCH’s Portal.

More details on Collateral Management here.

The DigitalAssetClear clearing system manages all the clearing members’ data, accounts such as the Position Account, Margin Account and Collateral Account. The sponsorship link(s) with trading participants is (are) also defined. In addition to the House segregation, LCH DigitalAssetClear offers different types of segregation at Client level which can be set up on request from the Clearing Member.

More details on Client segregation here.