The FMDQ Securities Exchange Limited and FMDQ Clear Limited, today mark a significant milestone in the Nigerian financial markets as it goes live with the introduction of the dynamic FMDQ Exchange-Traded Derivatives (ETD) Market, making it possible for market stakeholders – corporates, foreign & domestic investors and pension fund administrators – to hedge inherent financial market risks in their operational and investment activities.
FMDQ Securities Exchange which is a wholly owned subsidiary of FMDQ Group PLC achieved the new feat with the support of the Securities and Exchange Commission, the Central Bank of Nigeria, and the Debt Management Office.
The ETD market will provide an opportunity to convert risk to financial security, which in turn will help attract capital flows, reduce the cost of capital, promote market liquidity, and ultimately deepen the Nigerian financial markets.
The long-awaited FMDQ ETD market, which is geared towards transforming risk to certainty, in an unprecedented move, brings about the integration of the banking sector and capital market in Nigeria.
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Driven by FMDQ Securities Exchange Limited, Nigeria’s largest Exchange by Turnover, in collaboration with FMDQ Clear Limited, Nigeria’s foremost CCP, the FMDQ ETD Market, boasts of participation from ten (10) pioneer Deposit Money Banks and five (5) pioneer non-bank financial institutions, all positioned to change the landscape of the Nigerian financial markets in the near-to-medium term.
In support of the ETD Market, the three (3) pioneer General Clearing Members (GCMs) – Access Bank PLC, Zenith Bank PLC, and Stanbic IBTC Bank PLC – are capable of clearing transactions for their proprietary positions and those of other trading members and clients, will share mutualised responsibility as members of the CCP, and clear their proprietary positions, as well as twelve (12) Derivatives Trading Members, bringing the pioneer trading members in the ETD Market to fifteen (15).
The ETD Market goes live with two (2) pioneer products – the FGN Bond Futures and USD-NGN Non-Deliverable FX Futures – which will be traded and cleared on world-class FMDQ ETD systems, the FMDQ Q-ex Trading System and FMDQ Q-ex Clearing System, respectively.