Clearing over-the-counter derivatives
Abstract: Prior to the financial crisis of 2008, the over-the-counter derivatives market was not required to ?clear? transactions. This changed with the signing of the new financial reform legislation, the Dodd?Frank Act on July 21, 2010. Going forward, most OTC derivatives will be cleared through a particular set of institutional arrangements: a regulated clearinghouse. This article provides an overview of how clearing works, the potential benefits of central clearing for OTC derivatives, and the optimal clearing structure.
File(s): File format is application/pdf http://www.chicagofed.org/digital_assets/publications/economic_perspectives/2011/4qtr2011_part1_nosal.pdf
Provider: Federal Reserve Bank of Chicago
Part of Series: Economic Perspectives
Publication Date: 2011
Issue: Q IV