Portfolio Compression Services

Portfolio Compression (or trade tear-up) is a tool that enables market makers with two way positions to terminate a portion of their outstanding trades in OTC derivative markets before their actual termination dates. 

CCIL offers Portfolio Compression services to the members of the Rupee Derivatives and Forex Forward Segment. Through this service, CCIL brings about a reduction in outstanding trade count and outstanding gross notional amount by identifying economically redundant trades for termination. 

The process facilitates compression of members’ portfolio of outstanding trades by keeping the risk profile within the defined tolerances provided by the members.
The Portfolio Compression exercise is conducted by CCIL at periodic intervals. Members have an option to submit both their cleared and non-cleared trades for compression. 
CCIL’s periodic compression cycles provide an avenue to members to reduce their counterparty credit exposures and bring about savings in capital charges.

For further details on the process and the applicable charges, please refer to the latest Regulations and notifications of the respective segment. You may get in touch with the Risk Management Team for any queries in this regard.