The Dow Jones CDX single tranche templates, first issued in July, have been updated in response to the rapid evolution of the credit index trading mart. Higher trade volumes merit a simpler confirmation form, said officials, and market conventions have developed since the product first launched. Two templates, an updated single tranche stand-alone confirmation and a standard terms supplement, have been posted on the website of Markit, a credit pricing service. The templates have been negotiated by a range of dealers including representatives from Barclays Capital, JPMorgan and Credit Suisse First Boston.
Cleary Gottlieb Steen & Hamilton, representing the CDX consortium comprising 16 member firms, led the initiative by polling dealers and drafting the documents. Michael Dayan, an associate with Cleary Gottlieb in New York, said dealers would use the stand-alone document when trading the index occasionally. Customers with higher volumes could incorporate by reference the standard terms into the stand-alone template or use the master confirmation, which will not be updated without greater dealer demand.
