Achieving STP in OTC Derivatives — The Challenge of Constant Change

Abstract: "Innovation" appears to be the name of the game in the OTC derivatives world. Given the myriad product innovations witnessed within OTC derivatives markets, minimizing the risk of trading and settling these products certainly has turned out to be a complex affair. The growing number of product innovations coupled with increased usage of OTC derivative products seem to constantly change the OTC trading and trade processing landscape. Notwithstanding the substantial research and documentation executed toward eliciting the merits and shortcomings of OTC derivative product usage, this paper attempts to unravel the key components of OTC derivatives processing platforms which pave the way to achieving STP in OTC derivatives.

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