CMA develops credit derivatives analysis product

The Market Monitor product is an analysis system comprising a series of analytics of the market trading levels of US and European corporate bonds and default swaps. The product will enable investors to access credit spreads of cash securities as well as default swap levels for a range of credits.

The analytics included in the product include asset swap spread term structures for various credits as well as the correlation of the spreads between different names and various types of volatility analysis.

The product is principally targeted at fund managers and regional banks. The company claimed that at present sophisticated credit analysis is only available to a select few large investment banks.

“As a former trader in this market, I have been amazed at how little transparent information there is on the credit market,” said Forbes Elworthy, former co-head of structured credit products at Dresdner Kleinwort Wasserstein, who was appointed chairman of CMA earlier this week. Elworthy, who founded CMA in late 2000, will be responsible for marketing CMA’s credit products.

Elworthy said the company intends to develop another product later this year called the Credit Analyser, which will enable investors to combine the credit analytics to match their individual portfolios. “This will be a much more interactive product,” he said.

The firm also plans to push its products into Japan and Asia later this year, said Elworthy.