For all transactions transferred to ECC, ECC acts as a central counterparty which places itself between the seller and the buyer. ECC and its Clearing Members assume the trading participants’ counterparty risk and exploit the entire netting and cross-margining potential in the course of settlement.
Integrated Settlement (Straight-Through Processing)
A connective IT landscape supports all clearing and settlement functions, provides secure transaction management at low transaction costs and integrates all Partner Exchanges, Clearing Members and trading participants.
ECC uses its margin system to manage counterparty risk. This margin system has several lines of defence which provide protection against the default of counterparties:
- daily profit and loss settlement
- margins for open net positions based on the size of the position and the volatility of the underlying
- all Clearing Members and ECC contribute to a mutual Clearing Fund