Futures, Options, CFDs and Pricing Mechanisms

Overview


This Module is sufficiently extensive to fulfill most back-office operations for a 'Commission/Brokerage House' business. See business definition for F&O generalised business narrative.

A sub-set of these processes, with their links to Physicals trading, will allow a trading house to maintain hedge positions for F&O and FX.

There are ‘getting-started’ user guides for F&O/Treasury/Shares trading which will enable the user to follow the daily back-office tasks.
The instruments included are FX, Futures, Options, CFDs, Loans & Deposits, Bonds, Shares, Currency Options, FRAs and Pricing Mechanisms (very specialist Aussie). 

When trading Futures, the instrument can be setup as a Currency type (3rd party codes, SFA type) e.g. CME EUR/USD. This is handled in ITAS as a standard F&O instrument i.e. margining in underlying currency, usually USD, but if the TCCM coding is setup with the transactional currency the ITAS process CCYEXP can be used to view these hedges with their respective TRADEs.

The FX, Futures, Options and CFD (Contract for Difference) are administrated in full with the other instruments to a lesser extent, i.e. trade maintenance/fulfillment and simple reporting. The ITAS Report Writer program is sufficiently expert that users can generate their own administration reports for each instrument. Specific forms can be generated for each instrument using the DOCDES feature, this will enable contract notes to be produced for printing/email. There is considerable local help in every program to assist in the navigation and the codes basis of ITAS allows the user to setup any product being traded.

The main F&O features are entry of new business, amendment/deletion, exercise, abandonment, giveups, instructions through to executed business and import from your brokers.  Give Ups (Execution only) is a facility (TERM) for recording the trades that are given-up to another broker with commissions earned for the operating company.

A concern for the operating company is the source of current market/settlement prices for revaluation and margining.
Hivedome provide some standard links to various Internet web sites for settlement price retrieval e.g SPAN_NOW, RUBBERIMP (specific codes on SIMEX exchange), TOCOMIMP (specific codes on TOCO exchange). There is a Bloomberg live-feed procedure and Hivedome will investigate other data sources that our clients wish to use.

PRICEMEC (Pricing Mechanisms) is a specialist procedure, designed for Sugar Origin trading/administration.

 

Contents of Futures, Options, CFDs and Pricing Mechanisms