CME Group’s Direct Clearing Firm Auctioned it’s Asset

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Priyanka Kulkarni
Priyanka Kulkarni, post-graduated in Business Administration holds worthy experience in market research and investment banking. She is passionate to flaunt her perception towards cryptocurrencies.
  • The CME Group’s direct clearing firm was unable to meet its capital requirements. This proves that the clatter in financial markets is putting extreme pressure on some firms.
  • Reports confirmed that a Chicago-based venture Ronin Capital is the firm in this matter.
  • The CME Group’s chairman and CEO, Terry Duffy indicated that the auction was ended Friday morning but the Group is not willing to disclose the winning bidder in the auction.

Per sources, the CME Group’s direct clearing firm was unable to meet its capital requirements. This proves that the clatter in financial markets is putting extreme pressure on some firms.

The so decision forced the exchange to step in and raise its emergency portfolios to auction the portfolios. Reports confirmed that a Chicago-based venture Ronin Capital is the firm in this matter.

Sometimes trading market fails due to market volatility as they make a position that loses huge money at a certain period with no opportunity to recover before the exchange makes payments on behalf of the firms to clutch their positions.

The auction was coordinated The Depository Trust and Clearing Corporation (DTCC)

The CME Group’s chairman and CEO, Terry Duffy indicated that the auction was ended Friday morning but the Group is not willing to disclose the winning bidder in the auction.

Duffy pointed out that under its clearing agreement, Ronin is not permitted to have outside clients thus, there were no customers affected in the process.

Therefore, it can be assumed that the clearing firms like Ronin Capital, are responsible for the trades on the exchange. Some sources also reported that Ronin’s issues stemmed from future positions with the CBOE Volatility Index or the security that tracks market instability.

The following auction was coordinated by The Depository Trust and Clearing Corporation (DTCC) that later stated that it has stopped to act for Ronin Capital, LLC.

A Chicago-based firm that offers portfolio management

Ronin was one of the Chicago-based proprietary trading firms that trade for its owners and not clients. It was owned by John Stafford III and his father, John Stafford Jr. The firm offers portfolio management, financial planning, advisory services, and capital raising to its customers globally.

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