Fitch Ratings has launched a subsidiary to focus exclusively on the credit derivatives market, dubbed Derivative Fitch.
In an announcement, the agency said the move was prompted by traditional institutional investors increasing their participation in this market in addition to hedge fund and dealer activity.
Derivative Fitch will consolidate over 100 people from its global collateralized debt obligation and structured credit ratings groups. In addition to ratings, Derivatives Fitch will also offer stability scores, a service recently added for synthetic CDOs that reference corporate portfolios, and market-risk analysis.
Fitch recently acquired credit derivatives pricing and risk analytics models from Reoch Credit and announced a partnership with Markit Group to incorporate their credit derivatives data into existing Fitch models, according to the agency.