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Default management: behind the scenes with Eurex Clearing

Release date: 22 Dec 2017 | Eurex Clearing

Default management: behind the scenes with Eurex Clearing

At Eurex Clearing, we have implemented a default management process to handle the default of one or more of our Clearing Members. Both the default management process and the margin methodology Eurex Clearing Prisma® are based on a liquidation group set-up.

A liquidation group contains products with similar risk characteristics which can be liquidated simultaneously. For each liquidation group, a dedicated holding period has been defined, which indicates the time needed to finalize the default management process for a portfolio in such liquidation group. Identical holding periods are used as input factors for the margin calculation, to ensure that given margin offsets persist within the default management process.

Learn from our clearing experts about what happens in case of a default scenario and why portfolio hedging is so important.

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Watch Thomas Laux, Chief Risk Officer, Eurex Clearing, share his thoughts on the first global central counterparty (CCP) fire drill. 


Best practices for auctions in a default scenario

Interview with Marcus Addison, Head of Default Management, Eurex Clearing


What is portfolio hedging all about?

Find out when and how it takes place and why Eurex Clearing has its own traders: watch our interview with Marat Kadir and Michael Kraft from Eurex Cearing’s Default Management Team. The two traders share their thoughts on hedging in default scenarios.