The Depository Trust & Clearing Corp. is aiming to become the sole provider of names for inclusion in iTraxx indices by next September's roll. Dealers see the project as a way of improving transparency and efficiency and of alleviating the current dealer burden of providing trading lists.
Each iTraxx index consists of the most liquid names in its sector. Currently, those names are determined by the International Index Co., which collects lists of most-traded names from 33 licensed market makers and compiles a weighted average for inclusion at the roll. Market players said DTCC is better positioned to provide those names because it has access to all index trades.
A six-dealer working group under the auspices of International Index Co. proposed the idea in the run-up to this month's Sept. 20 roll and has been working on the project for several weeks. Tobias Sproehnle, iTraxx product developer at International Index Co. in Frankfurt, said DTCC is working on clearing up the backlog of unconfirmed trade assignments but is planning a trial run for the March roll. Peter Axilrod, managing director in business development at DTCC in New York, did not immediately return a phone call.
