“To build on this momentum, we also aim to launch a solution in the near future that allows investors to create a custom basket futures contract as an alternative to OTC equity swaps.”
Nasdaq has launched the Nasdaq Custom Basket Calculation Service (CBCS), which allows clients to design and configure baskets of stocks with custom characteristics such as currency, return type, composition and weightings from a pre-approved universe of actions.
The calculated basket level and benchmark data are validated and distributed with the daily basket weight reports.
Nasdaq launched CBCS to meet growing demand for an efficient way to manage proprietary indices, thematic baskets and ESG investments. The service stems from a collaboration between Nasdaq and S&P Global Market Intelligence.
Outsourced calculation service to avoid conflicts of interest
Available to members of Nasdaq Stockholm AB or Nasdaq Clearing, the CBCS service allows clients to benefit from basket level calculation for each basket, managed and verified corporate actions such as stock splits, dividends, mergers and acquisitions and the implementation of these changes in defined baskets in a timely and accurate manner.
Christopher Hare, Executive Director of S&P Global Market Intelligence, said, “We are delighted to see the launch of what will be the first major product in a broader collaboration between the two companies. The combination of our service capabilities will offer enhanced administrative, compute and distribution services, to provide a seamless end-to-end workflow and meet the demand for bespoke baskets. As we look forward to the next phase of the service, the ability to generate on-demand quoted exposure for equity portfolios will introduce an exciting shift in the trading vehicles available to consumers and the speed at which demand for customers can be satisfied. ”
James McKeone, VP European Data at Nasdaq, commented: “With CBCS, our clients benefit from a fully managed solution for custom basket calculations, an outsourced calculation service to avoid conflicts of interest by separating computing from the end user’s own company, and a solution that is provided by the Nasdaq Certified Benchmark Administrator and thus ensures high data quality.To build on this momentum, we also aim to launch in the future near a solution allowing investors to create a futures contract on custom baskets as an alternative to over-the-counter equity swaps.