A planned revolution in swaps trading that was intended to push much of the US$710trn over-the-counter derivatives market on to exchange-like venues has yet to have any significant impact beyond increasing the complexity of the existing market structure, according to some buyside firms. Originally aimed at increasing efficiency and transparency, while creating a level playing field for buyside and sellside firms, the Dodd-Frank Act mandates the most liquid swaps for trading on newly-created swap execution facilities. But, so far, liquidity in central limit order books has been slow to build, leaving the market looking little-changed for some participants, who still have to rely on request for quote protocols to execute trades.
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