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Markit was a British financial information and services company that focused on credit derivative pricing. It was founded in 2003 and merged in 2016 with IHS to form IHS Markit . Prior to its merger it had 4,500 employees in 21 offices worldwide and was as an independent source of credit derivative pricing. [ 3 ]
The CUSIP-linked MIP code (CLIP) is used in the financial derivatives markets to identify the reference entity of a credit default swap. [1] It is mainly used as a key field in Markit's reference entity database (RED). Each CLIP is linked with one or more CUSIPs each representing reference entity obligations .
A credit default swap index is a credit derivative used to hedge credit risk or to take a position on a basket of credit entities. Unlike a credit default swap, which is an over the counter credit derivative, a credit default swap index is a completely standardized credit security and may therefore be more liquid and trade at a smaller bid–offer spread.
By 2011 Markit iTraxx and Markit CDX index trade volumes exceeded US$70 billion a day. They had a "net notional outstanding over US$1.2 trillion." In 2011 Markit iTraxx and Markit CDX index traded almost 50% of the market in single name credit derivatives.(Nolan & Sproehnle 2011)
An asset-backed securities index is a curated list of asset-backed security exposures that is used for performance bench-marking or trading.. The original asset-backed securities index was the ABX, a synthetic tradeable index sponsored by Markit (now IHS Markit), which referenced a basket of 20 subprime mortgage-backed securities.
iBoxx is a financial services division of IHS Markit that designs, calculates and distributes fixed income indices. iBoxx is overseen by IHS Markit Benchmark Administration Limited (IMBA UK), which is regulated by the Financial Conduct Authority and is an authorized benchmark administrator under the UK Benchmarks Regulation (UK BMR). IMBA UK's ...
A "credit default swap" (CDS) is a credit derivative contract between two counterparties. The buyer makes periodic payments to the seller, and in return receives a payoff if an underlying financial instrument defaults or experiences a similar credit event. [7] [14] [15]
Credit derivatives are fundamentally divided into two categories: funded credit derivatives and unfunded credit derivatives. An unfunded credit derivative is a bilateral contract between two counterparties, where each party is responsible for making its payments under the contract (i.e., payments of premiums and any cash or physical settlement ...