As policymakers in emerging and frontier markets consider the regulatory framework for financial markets in their jurisdictions, the need for customized risk management tools by market participants remains important.
Market participants use over-the-counter (OTC) derivatives because they are able to customize the terms of their contracts to align more precisely with their specific hedging needs.
With the expansion of central clearing for OTC derivatives, there is a perception that cleared IRD transactions have become standardized, like interest rate futures.
Using data from the Depository Trust & Clearing Corporation, this paper examines the population of cleared fixed-for-floating IRS and demonstrates that cleared products remain highly customizable as compared to futures contracts, enabling buyers and sellers to agree on bespoke terms to better manage the risks to which they are exposed in the normal course of their business operations.
Click on the attached PDF to read the full report.
Documents (1) for Interest Rate Swaps: Cleared and Customized
Latest
ISDA In Review – August 2026
A compendium of links to new documents, research papers, press releases and comment letters published by ISDA in August 2026.
Remove Bureaucracy from Cross-margin Approvals
Cross-margining programs play a critical role in financial markets. By ensuring margin requirements more closely reflect the actual risk of a portfolio of products, they reduce liquidity strain and improve market efficiency, both of which will become even more important...
Joint Response on CCP Resolution
On September 7, ISDA and FIA responded to a Bank of England (BOE) discussion paper on central counterparty (CCP) resolution. The associations support greater clarity on valuation capabilities prior to a crisis scenario and the boundary between recovery and resolution,...
Expanding Legal Agreement Coverage in the CDM
This paper examines the recent extension of the Common Domain Model (CDM)1 to represent two of the most significant, and previously undeveloped, areas of its legal agreement model: umbrella agreements and contract amendments. Umbrella agreements are widely used to document...