Cleared OTC Swaps on Commodity Indexes

Mitigating Risk through Comprehensive Financial Safeguards

In response to continued global financial difficulties and tightened credit due to counterparty risk concerns, CME Group now offers cleared swaps on the S&P GSCI Excess Return Commodity Index, with additional commodity swap indexes expected to be available soon.

These indexes have been designed to track the futures prices of products representing energy, agricultural and metals products with a transparent, rule-based system for choosing and weighting the products. The engineering of investment funding vehicles that track commodity futures indexes has provided investors with the means for gaining exposure to commodities that offers better potential to capture the full benefits of the asset class.

Cleared OTC commodity index swaps offer OTC market participants the full benefits of central clearing, including:

  • Decrease in counterparty credit risk
  • Decrease in operational and legal risks that customers face in OTC trading
  • Customer funds and positions are held in sequestered accounts, separate from assets of each customer's clearing firm
  • Mark-to-market margining
  • Capital efficiencies for offsetting positions and multilateral netting

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