MCA-Xpress is a service for OTC equity derivatives. MCA-Xpress allows parties to an OTC equity derivatives transaction to negotiate and execute ISDA®-published master confirmation agreements (MCAs) online and to maintain these and manually executed MCAs in a centralized location.

Overview

MCA-Xpress is a service for OTC equity derivatives. MCA-Xpress allows parties to an OTC equity derivatives transaction to negotiate and execute ISDA®-published master confirmation agreements (MCAs) online and to maintain these and manually executed MCAs in a centralized location.

MCAs are a key component of the legal documentation that creates legally binding trades between two parties of an OTC derivative transaction and are required prior to moving to an electronic confirmation platform such as DS Match.

Equity derivatives embody multiple combinations of product types and geographic regions, and their complexity and lack of standardization have made them challenging to automate. The resulting backlogs and associated risks are similar to those that characterized the OTC credit derivatives market several years ago.

MCA-Xpress streamlines the negotiation and execution process by automating what has traditionally been manual and labor-intensive, fostering market participants' ability to move to an automated environment for processing OTC equity derivatives trades. Parties can upload and reference MCAs executed outside MCA-Xpress, thereby providing a single global location to view all MCAs.

Who Can Use This Service

Dealers and buy-side firms can use MCA-Xpress.

Benefits

• Enhances efficiency by simplifying the process for completing MCAs through on-line global negotiation of agreements and by maintaining documentation among counterparties in a centralized, secure location.
• Lowers costs involved in the labor-intensive, time-consuming legal review and negotiation of voluminous paper-driven documents related to multiple products, regions and trading parties.
• Reduces operational risk by expediting the steps involved in the MCA process enabling quicker confirmation execution.
• Increases controls by providing a single secure location to view all executed MCAs.

How the Service Works

MCA-Xpress consolidates over 20 MCAs, including the ISDA® Equity MCA Protocol, into a user-friendly matrix and provides parties with their own private, secure location to manage their MCAs. Counterparties select the dealer(s) with whom they wish to commence negotiations, and then choose specific MCAs to negotiate.

Users of the service can also upload and/or provide information related to MCAs executed outside the service, helping create a complete recordkeeping and audit trail. MCA-Xpress provides one location for entering these legal agreements and gives individual firms the ability to see all documents they have executed with their counterparties.

MarkitSERV's Operating Procedures include provisions to verify that an MCA executed through the service shall constitute a legally acceptable method of qualifying their transaction.

Once an MCA is complete between two counterparties, these firms can submit their OTC equity derivative transaction for electronic matching and confirmation on services such as DS Match.

MCA-Xpress is designed with an open architecture that allows access to other third party service providers. If a party executes an MCA on MCA-Xpress, the firm can also apply those execution dates to transactions completed on paper or through another electronic matching and confirmation platform. Proprietary MCAs held by a firm can be added to MCA-Xpress by starting with an ISDA/industry-published template, adding other terms and then saving the template for negotiation and execution with future counterparties.

MCA-Xpress supports all ISDA-published MCAs, including the Equity MCA Protocol (Q2'08) which is designed to agree to default MCA terms and to negotiate fewer terms, and will add/modify MCAs as soon as published.

For More Information

For more information, please contact a Client Account Manager via e-mail at CAG@markitserv.com or by phone.