The full integration of security futures into the ADP/SIS platform allows clients to enter and route orders for both single stock and index futures via its Order Management System (OMS). After the order is executed, clients can perform mark-to-market calculations, margin analysis, settlement activities, and accounting functions for all their security futures trades, all within the framework of ADP/SIS's straight through processing Brokerage Accounting System (BAS). In addition, POSSEsm, ADP/SIS' browser-based broker desktop application, allows sales executives to place and review security futures orders in real time.
Clients are able to customize the platform to match their firm's futures trading policies, as well as establish their own margin requirements and security futures commission calculations. Also, a wide range of reports are available to provide comprehensive risk management and performance analysis.
Security futures products include both single stock futures and narrow-based index futures. Single stock futures are futures contracts on individual stocks, while narrow-based index futures are futures contracts on small groups of stocks in a concentrated area of the equities market. A security futures contract is an agreement between two parties to buy or sell 100 shares of a specific stock (or stock index) on a designated date in the future. If held until maturity, the buyer will pay the current value of the shares and receive the underlying equity. Currently, one single stock future contract is equal to 100 shares of the underlying security.
John Foster, chief operating officer of BNP Paribas Brokerage Services, Inc. said his firm will be the first user of ADP/SIS's security futures processing system. "We were very pleased to see ADP/SIS develop integrated processing capabilities for single stock futures. With the leverage it offers, this hybrid product has every potential to become extremely popular as the markets rebound. ADP/SIS will allow its clients to participate in this marketplace without the need to purchase dedicated futures software."
David Swift, senior vice president and general manager of ADP/SIS commented, "Many firms are interested in trading single stock futures, but they are reluctant to add a separate processing system in order to trade these instruments. ADP/SIS recognized that if we could provide an end-to-end, integrated security futures platform, we would give our clients a technologically superior, competitive edge in this new market."
