OSTTRA, a 50:50 joint venture between CME Group and IHS Markit, plans to use its Indian operations to further develop post-trade solutions for exchange traded derivative markets around the world, its Co-CEO John Stewart has said.

This scaled fintech, which was formed in 2021 through the combination of four businesses that have been at the heart of post-trade evolution and innovation for the last 20-plus years—MarkitServ, Traiana, TriOptima and Reset, is looking to ramp up its Indian operations and wants to leverage on the Indian talent pool.

OSTTRA has been primarily focused on institutional post-trade solutions for the global OTC markets across interest rate, FX, equity and credit asset classes. 

Although its products and solutions are primarily Over the Counter (OTC) based, the near term objective is to build an exchange trade derivative (ETD) solution for global derivative markets and that is where it plans to use Indian talent, Stewart told BusinessLine here.

OSTTRA has a well-established ETD post-trade service, used by many global banks and investment managers today. “We’re currently extending that service to further streamline ETD trade processing, addressing pain points faced by the industry during periods of peak volatility,” Stewart said.

OSTTRA plans to ramp up its India headcount from 300 at its Gurugram unit now to 450 by June 2023 and to 600 by end 2024. Most of the increase will come out of shifting of personnel from its Tel Aviv operations, which it plans to close in the coming days, Stewart said. It currently has aggregate workforce of 1,200 across global markets. 

“My objective is to have 50 per cent of our global footprint  of 1,200 coming out of India by 2024.  The top draw for us to the Indian market is the rich talent pool available here. Within that talent, there is good subject expertise too (on financial markets, derivatives etc)”, Stewart added.

Going forward, OSTTRA wants to directly service/supply post trade solutions from its Indian unit to many of its global clients who are already having operations in India. “Rather than move our offerings from our Indian unit to London and then bring it back to India for our global clients operating already in India, we want to directly within India offer it to them”, Stewart said..

GIFT City plans

Stewart said that OSTTRA plans to explore entry into Gift City to address opportunities in non deliverable forwards (NDF) market. There could be potential to offer trade compression services and NDF clearing in the days to come , he noted.

NDFs are also known as forward contracts for differences. NDF is an outright forward or futures contract in which counterparties settle the difference between the contracted NDF price and the prevailing spot price on an agreed notional amount. 

“We have a huge footprint in NDF market.The Gift City initiative may prompt NDF market to move back to India from Singapore. So we plan to explore entry into Gift City, but we have not made any financial commitment for this”, Stewart said.

He noted that this could be the first opportunity for OSTTRA to create onshore commercial footprint in India.

Cryptos

OSTTRA will develop post trade solutions for cryptos, Stewart added. It will also look to build exchange traded offerings for crypto futures. It may be recalled that OSTTRA parent CME Group is already providing Bitcoin futures on its platform. “OSTTRA has intention to extend its offerings to crypto market, leveraging its experiences in other asset classes”, he added.

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