CME Launches CME Direct for Energy Trading

CME Group has launched CME Direct, which provides side-by-side trading of exchange-listed and over-the-counter (OTC) markets.

CME Direct will initially support trading of CME Group's benchmark energy futures markets alongside OTC energy swaps through major inter-dealer brokers. It is integrated with CME Group's OTC post-trade services, CME ClearPort for straight-through clearing to CME Clearing and CME Clearing Europe and CME ConfirmHub for straight-through processing (STP). This integration ensures OTC markets are cleared and processed quickly and without manual intervention, reducing operational overheads, errors and counterparty risk, according to CME officials.

"By combining brokered OTC markets with CME Group's clearing and STP platforms—ClearPort and ConfirmHub—CME Direct offers the first global, fully automated front-to-back-office platform for trading CME listed and OTC energy products," says OTC solutions managing director Michel Everaert. "CME Direct is a big step forward for markets to comply with current and anticipated market regulations, including those proposed under the Dodd-Frank Act and the Markets in Financial Instruments Directive (MiFID) that call for more transparency, automated trading, data reporting and clearing in OTC markets."