Asset Managers and the Uses of Collateral in OTC Derivatives, Securities Lending and Repo: A Finadium Survey

October 2015

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Asset managers are active participants in OTC derivatives, securities lending and repo, all markets that rely on collateral to manage risk and exposure. As banks have learned, optimizing collateral creates opportunities for revenue generation and operational efficiencies across the firm. While asset managers understand this conceptually, individual firms are at very different stages of learning why and when they would embark on installing technology not just for collateral movements in one silo, but to gain a cross-product view of the collateral at their disposal.

This report presents the final results of Finadiumʼs 2015 asset manager survey, covering US$24.6 trillion in assets across 32 large buy-side firms. Our survey includes mutual funds, UCITS funds and insurance companies in North America and Europe. The results of this survey are useful for any asset manager looking to benchmark their progress and thinking against their peers, and for service providers looking to better assist their clients in optimizing collateral processes.

This report is part of the Finadium Executive Briefing series, providing briefings and analysis to the financial markets industry.

This report is 18 pages with 9 exhibits.

■ Executive Summary

■ A New Market for Collateral and Liquidity
– Methodology

■ Market Participation and Collateral Pools
– Commingling and Collateral Optimization

■ Technology, Outsourcing and Cash vs. Non-Cash

■ Future Directions for Collateral on the Buy- Side

■ About the Author

■ About Finadium


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