Cleared OTC London Gold Forwards

  • 19 Jul 2010
  • By CME Group
  • Topics: Metals

Credit Risk Mitigation for the London Gold Forwards Market

By offering our clearing house experience, financial safeguards and post-transaction services, CME Group is uniquely positioned to provide counterparty credit risk mitigation services to the OTC London gold forward market with our Cleared OTC London Gold Forwards contracts. This service provides centralized clearing, settlement and delivery for OTC London unallocated gold forwards. The Exchange offers two contracts: Cleared OTC London Gold Forwards (Collateral Margin) and Cleared OTC London Gold Forwards (Cash Margin). 

Mitigate counterparty credit risk. CME ClearPort uses a central counterparty clearing model, where counterparty credit risk is shared among clearing members. This allows the central clearing house to guarantee the performance of every transaction – and the security of every clearing member’s customer. CME ClearPort gives you access to neutral valuations and our daily mark-to-market process enables you to track positions accurately and assess risk. 

Trades can be submitted for clearing through CME ClearPort up to and including one good business day prior to the delivery date. Clearing coverage for all good forward maturities that are deliverable into unallocated “London Good Delivery” gold (as defined by the LBMA2) extends 10 years out.

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Futures & Options Trading

As the world's leading and most diverse derivatives marketplace, CME Group is where the world comes to manage risk. CME Group exchanges offer the widest range of global benchmark products across all major asset classes, including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. CME Group brings buyers and sellers together through the CME Globex electronic trading platform and trading facilities in New York and Chicago. CME Group also operates CME Clearing, one of the largest central counterparty clearing services in the world, which provides clearing and settlement services for exchange-traded contracts, as well as for over-the-counter derivatives transactions through CME ClearPort.

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