Trepp LLC is marketing Trepp Derivative, an analysis program to help investors understand derivatives. It is geared toward hedge funds, European investors and other new investors, said Manus Clancy, managing director.
At the same time, Markit Group, the administrator for the new CMBX index (REFI, 3/6) , has selected Trepp to provide cash flow information for CMBS included in the index. Trepp launched Trepp Derivative in response to the growth of the synthetic CMBS market. There is a limited amount of CMBS in certain tranches, specifically for BBB and BBB- bonds. Clancy believes that investors will use Trepp Derivative to fully analyze the cash flow and underlying collateral in these securities before taking synthetic positions.
Trepp plans to extend Trepp Derivative to support the emerging single-name CMBS credit default swap market. In addition to the creation and analysis of CMBS and commercial real estate CDS, clients will be able to monitor their book of positions to identify possible credit events as early as possible and project net cash flows. Trepp Derivative will support a number of real estate synthetics, including single-name CMBS bonds, baskets of CMBS and mortgages of a certain property type and/or regions, Clancy added.