Brevan Howard picks derivs clearing system

DerivativesJersey-based hedge fund Brevan Howard has become the first buy-side firm to join AcadiaSoft Hub’s Initial Margin Exposure Manager (IMEM) network, a service for managing initial margin requirements for derivatives trading.

Brevan Howard is one of the first buy-side firms to fall within the scope of the latest collateral and clearing rules for over-the-counter (OTC) derivatives, which came into effect on September 1.

Brevan Howard will be using the IMEM service to reconcile two-way initial margin with its derivative trading counterparties as per the new rules, states AcadiaSoft.

According to Gilles Marion, head of risk services for Brevan Howard, the number of counterparties already using the IMEM service was a large influence in its system selection.

“Regulatory initial margin is calculated using a standardized but complex portfolio risk sensitivity model,” he said. “For daily reconciliation of this data across multiple counterparties it is therefore essential to use a common platform.”

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