FAQ: CME Clearing Services for FEX Global

1.     How can clients and clearing members get involved?

Existing clients and clearing members of NYMEX can leverage their setup and new clearing members can commence their onboarding any time.

For more information, contact FEXClearing@cmegroup.com.

2.     As a clearing member, how do I onboard to clear FEX products?

Our global post-trade services team would be happy to assist you – you can contact them at FEXClearing@cmegroup.com or via telephone through our global hotline at +1 312 207 2525. Please request our onboarding checklist.

3.     If I currently have a clearing membership with CME, do I need a separate agreement with CME?

Interested clearing firms will need to be a NYMEX clearing member in good standing with CME Clearing. Clearing member firms that want to clear FEX products will be required to submit supplemental documentation specific to the FEX service. Additionally, CME Clearing’s Risk Team will assess your firm’s ability to support clearing and meet liquidity needs to support the APAC cycles.

4.     Is there a requirement for clearing firms to test FEX products before go-live?

Yes, CME Clearing recommends at least 1-2 weeks of member testing before go-live. CME fully supports all FEX products and cycles in its new release test environment.

5.     Are FEX products supported in the existing front-end clearing and positions systems?

There are separate applications that are FEX specific. CME Clearing can work with you to ensure that you have all the appropriate access before going live.

6.     What reports and referential data will be available specific to FEX?

Settlement decks, SPAN and product reference files specific to FEX will be produced.

Separate clearing member reports including trade registers, margin and settlement reports are also available.

7.     What will be the account structure for FEX?

FEX clearing will be supported by NYMEX clearing members utilizing the familiar structure of position, margin and settlement accounts for offshore brokers intermediating customer business to CME Clearing. Clearing member firms may establish individual customer accounts, set to net, or customer omnibus accounts, with PCS to adjust positions and CGM for customer-level margining. At launch, FEX customer collateral at CME Clearing will be subject to secured 30.7 customer protections.

8.     Is FEX included in the same settlement cycles as other CME Clearing settlement cycles?

CME Clearing has created two new settlement cycles in the APAC time zone to accommodate FEX and better support market participants in the region, with Intraday at noon and end of day at 7 p.m., both in Sydney local time.

9.     Which types of collateral are accepted for margin requirements resulting from these new settlement cycles?

For Day 1, collateral to meet AUD-denominated requirements will be limited to AUD cash. Collateral to meet USD-denominated requirements will be limited to U.S. Treasuries, USD cash and AUD sovereign bonds. CME Clearing will evaluate the need to expand the list of acceptable collateral in the future based on client demand or its own assessment.