On the Clearing of Foreign Exchange Derivatives

11 Pages Posted: 22 Jun 2011

See all articles by Darrell Duffie

Darrell Duffie

Stanford University - Graduate School of Business; National Bureau of Economic Research (NBER); Canadian Derivatives Institute

Date Written: April 2011

Abstract

This note discusses the case for exempting foreign exchange derivatives from recent regulatory requirements for over-the-counter derivatives, including clearing, trade competition, and minimum collateral requirements. My conclusion is that the arguments that have been made for such an exemption are not sufficient. I focus mainly on the question of clearing, which figures prominently in arguments favoring exemption.

Keywords: derivatives, foregin exchange, over-the-counter derivatives, trade competition

JEL Classification: G10, G14, G18, G28, G38

Suggested Citation

Duffie, James Darrell, On the Clearing of Foreign Exchange Derivatives (April 2011). Rock Center for Corporate Governance at Stanford University Working Paper Series No. 102, Available at SSRN: https://ssrn.com/abstract=1869065 or http://dx.doi.org/10.2139/ssrn.1869065

James Darrell Duffie (Contact Author)

Stanford University - Graduate School of Business ( email )

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National Bureau of Economic Research (NBER)

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Canadian Derivatives Institute ( email )

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