Trepp LLC and Markit have agreed to a partnership that will bring greater transparency and accuracy to the valuation of synthetic Commercial Mortgage-Backed Securities (CMBS).
The agreement will integrate Markit’s valuation input template into TreppDerivative, Trepp’s analytics and surveillance product for CMBS derivatives. The relationship allow joint clients to manage their pricing processes for synthetic CMBS contracts more efficiently. Valuations analytics for the Markit CMBX, a synthetic index of US CMBS, have incorporated Trepp’s cashflows since the launch of the index in 2006.
“We value Trepp’s CMBS expertise which contributes significantly to the CMBX calculator we offer the trading community. Accurate valuations of complex products are critical in today’s markets and we believe that our enhanced tool will provide clients with unique insight into the valuation of synthetic CMBS,” says Ben Logan, managing director of Structured Finance, Markit.
Subscribers to this service will be able to export their contract terms and conditions compiled within the TreppDerivative product to Markit for valuation. This single interface for analytics, cashflows and valuations will streamline the process for the end-user and will result in greater efficiency and accuracy of trade input.
“Markit has an established reputation for bringing breadth and quality of product to the market and Trepp is very pleased to build on our long-standing relationship.
The biggest challenges in the current CDS space are removing operational risk and obtaining accurate valuations. This partnership does that. With TreppDerivative, all the functions that the cash market has come to expect are now available to CDS investors integration of risk management with back office and trading, cashflows, surveillance tools,” says Dan Gottlieb, CEO, Trepp.