Attempts at CDS portfolio margining in regulatory limbo
Dealers worry about the impact on liquidity unless single-name and index trades can be margined together
Central counterparties (CCPs) are facing regulatory delays in efforts to provide margin efficiency between single-name and index credit default swaps (CDSs) – an issue that could cause liquidity in the CDS market to evaporate unless it is resolved, dealers claim.
"The market is very concerned about this, because it could significantly diminish liquidity on both index and single-name CDSs if clients aren't able to get margin offsets between the two," says Mariam Rafi, Americas head of over-the
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