What effect will the new CDS exchange have on interdealer brokers?O
Credit derivatives have been a pretty lucrative product for interbroker dealers since all of the transactions are conducted OTC. How badly are all the interdealer brokers (mainly ICAP, GFI Group, Tradition, Cantor Fitzgerald, etc.) going to be hit once the CDS exchange is finally launched?
Business in single name CDS issues will probably see significant decreases but I imagine that the more complex, exotic OTC derivative products will still require interdealer brokers?