OTC Derivatives & Portfolio Compression Companies
With its main office in New York, United States, INTLFCStone is a leader in customized financial services. The company offers a range of comprehensive customized financial tools and services to their more than 100,000 clients who are then able to manage their volatility and protect their margin. They are committed to serving mid-market clients by opening them up to markets through insights, access, and guidance. Its OTC products are focused on creating more customized solutions that address the unique risk management needs for their customers.
ASX is a world leader in financial market exchanges. The company provides a range of services including trading, settlement, listing, and clearing. With more than 150 years of experience in the industry, ASX is among the top five exchanges in the global platform.
The company’s earnings per share in 2018 was 127.10 cents. Profit realized by the company in 2018 was $246.1 million.
CLS focuses on helping its clients navigate the changing FX market place to be more efficient and reduce risks. Since its inception in 1985, the company has been committed to serving clients who are in telecommunication, renewable energy, utility, oil and gas, and construction. By implementing innovative products, their trading process has contributed to the success of their clients becoming easier, more cost-effective, and fast. They offer a range of products including OTC derivatives.
According to Finance Magnetics CLS 2017 annual revenue was £197.5 million, which, converted to U.S. dollars, is $254.9 million.
LCH is a premier in providing risk management solution across a range of asset including fixed income, commodities, FX, OTC, FX, Equities, and posted interest rates. By operating in an open access model, the company offers to its client a range of execution venues and efficient services. Having been in the industry for than 100 years, LCH started as a small commodity clearing company in 1888, and since then it has been experiencing steady growth over the years.
The company generates its revenue in the OTC derivatives market through an annual fee from members or charging a lower fee with variables based on volume. Additional income is generated from compression services. According to the company’s 2017 financial report, revenue realized from OTC derivative clearing was €239.6 million, which, converted to U.S. dollars, is $267.3 million. EBITDA was €197million and profit before tax was €145.7 million.
Companies in order by revenue
Based on the reported revenues for the companies we have researched and identified, they are ordered by revenue as follows.
Intercontinental Exchange (ICELink) - $3.5 billion
INTLFCStone - $975.8 million
NEX Group (TriOptima) - $762.7 million
LCH Group - $267.3 million (converted from €239.6 million)
CLS Group - $254.9 million (converted from £197.5 million)
ASX Group - $246.1 million
Capitolis - $1 million
We began by searching for publicly available industry reports, studies, articles, and blogs on the OTC derivative novation and portfolio compression market with the focus of identifying companies that operate in this market. We leveraged on sources like ISDA, Deutsche Borse Group, BIS, IBFD, Fine Extra, and ECMI among others. After a though search and analysis of these sources, we were able to identify the five companies mentioned above.
Once we'd found these companies, we looked for their competitors from sources like Crunchbase, Pitchbook, and Craft, to identify more companies in the space. However, most competitors were based on other services not specific to this industry, so we left them out. We then used each company's available annual financial report to get their annual revenues to help us determine their market position.