Fitch Ratings just announced the launch of Derivative Fitch, which is the first specialist rating agency designed to provide the credit derivatives market with ratings, research, analytics and evaluation services that address the unique risks of the market.

With the credit derivatives market now at the $33 trillion area in notional value outstanding, the market is now a dynamic element of the global financial economy, as many participants use credit derivatives to manage their risk profiles, said Fitch in a release. Fitch added that unlike the traditional bond market, the structural complexity of the credit derivatives market is significantly different as these instruments and securities are affected not only by risk associated with underlying assets but also heightened sensitivities to factors like credit stability and market risk. The rating agency added that while hedge funds have been active participants in this market, traditional institutional investors, such as pension funds, banks, insurance companies and fund managers, are increasingly their participating in this market.

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