NASDAQ Going After Derivatives Market in London

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NASDAQ OMX (NASDAQ: NDAQ) has now announced that it intends to launch a new London-based trading venue called the NLX, which will offer derivatives on both short-term interest rates and long-term interest rates. The derivatives will be euro-based and sterling-based listed derivative products.

The exchange will provide competitive execution and clearing fees and the aim is to launch in early 2013.  NASDAQ’s NLX is partnering with LCH.Clearnet for its Synapse derivatives platform for clearing and settlement services.

NASDAQ noted that this effort will allow for it to capitalize off of market structure changes which are partly driven by Dodd-Frank, EMIR, MIFID II and Basel III.  This effort will also make more and more of these derivatives easier to see and understand as they will be ‘exchange listed’ rather than over-the-counter.

Keep in mind that NASDAQ already has the European equity listing operations of NASDAQ OMX as a cash equity markets in Europe. NASDAQ OMX also trades corporate bonds and other fixed income products, including clearing service for the repo market.