Swap Execution Facility
AEGIS Hedging Solutions Files SEF Application with CFTC
Filing is among the first ever by a Commodity Trading Advisor
The Woodlands, Texas, March 3, 2021 – AEGIS Hedging Solutions (“AEGIS”), a leading Commodity Trading Advisor (“CTA”) and fintech provider for commodity and rate markets, today announced that it has filed an application with the Commodity Futures Trading Commission (“CFTC”) to become a Swap Execution Facility (“SEF”) under the CFTC’s rules issued pursuant to the Dodd-Frank Act.
AEGIS works with hundreds of companies to research potential price movements in commodity and rate markets, develop tailored hedging strategies to protect cash flow from related volatility, and manage all hedge positions through settlement. AEGIS has established a subsidiary, AEGIS SEF, LLC (“AEGIS SEF”), to facilitate the negotiation and execution of bilateral derivative contracts between commercial end-users and their financial counterparties.
AEGIS SEF will enable (i) a request-for-quote (RFQ) function to allow negotiations between clients and financial counterparties and (ii) a central limit order book (CLOB). Trading on the AEGIS SEF will be focused on bona fide hedge transactions; swaps not used for hedging purposes (i.e., speculative trades) will not be permitted. Justin McCrann will serve as President of AEGIS SEF.
“Being among the first CTAs to file a SEF application is consistent with our leadership position in the industry,” said Bryan Sansbury, CEO of AEGIS. “CTAs and Introducing Brokers play a critical role in helping companies navigate otherwise complex bilateral swap markets. We strongly believe all participants in these markets will benefit from consistent pre-trade communication, published rulebooks governing activity, technology facilitating transparency and compliance, and capturing trade details that enable full audit trail/recordkeeping.”
AEGIS will be working with customers and financial counterparties throughout the application review period to ensure each is prepared to engage with AEGIS SEF when the filing is approved for operations.
“Today marks the culmination of more than a year’s effort to produce our filing and enable our technology,” said Justin McCrann, President of AEGIS SEF. “However, we know it is one step in our journey. We look forward to working with our partners in the financial counterparty community, and potentially other CTAs that might participate on our SEF to make AEGIS SEF fully operational.”
Phil Lookadoo and Serge Agbre out of the Washington D.C. office of Haynes & Boone served as legal counsel to AEGIS in producing the filing.
AEGIS Hedging Solutions enables companies to manage their commodity price and interest rate risk through leading software and advisory capabilities. AEGIS provides unique insight into commodity and rate markets, develops and executes cash flow protection strategies, and manages all hedge program activities through a SaaS technology platform. AEGIS was recently named the Hedge Advisor of the Year for an unprecedented fourth consecutive year.
AEGIS is headquartered in The Woodlands, Texas, and has offices in Chicago, Dallas, Denver, Houston, Knoxville, and Pittsburgh. To learn more, visit AEGIS’ website at www.aegis-hedging.com.
About the AEGIS SEF
AEGIS SEF (US) LLC, a subsidiary of AEGIS Hedging Solutions, will operate markets for commodities, interest rate swaps and other instruments. The AEGIS SEF will offer a venue for trading in uncleared bilateral OTC swaps and intends to operate central limit order books (CLOB) and request for quote (RFQ) systems, as well as offering block trade capabilities via counterparties. The AEGIS SEF is headquartered in The Woodlands, Texas. For more information, please go to https://aegis-hedging.com/swap-execution-facility.
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To see the official announcement, please click here.
Last Updated Feb 23, 2021