Credit Event In Canada Gears Up CDS Market
Dow Jones - January 25, 2008
This story discusses the upcoming credit event auction for Quebecor World Inc., which is expected to be the first settlement process since late 2006.
The credit event auction allows investors to settle outstanding CDS and provides an alternative to providing the physical bond, as required by most CDS contracts. According to the story, “the auction streamlines what was once a potential nightmare: because there are often more CDS trading than bonds, there can be a spike in bond prices as investors track down the paper they have to hand over.”
The story says the auction will be managed by interbroker dealer Creditex and Markit on February 19.
