Financial products Markup Language
The Financial Products Markup Language ( FpML ) is an XML -based protocol for electronic trading and processing of complex financial products. The aim is to be able to map all OTC derivatives .
In contrast to similar standards such as SWIFT or FIX , FpML defines neither network structures nor transport mechanisms.
background
Trading in OTC products such as swaps has grown by leaps and bounds since the early 1980s. Since it involved only two opponents are are the characteristics of the business can be flexible, but also negotiated non-standardized. In connection with the large trading volumes, this flexibility results in a technologically and personnel-intensive workflow that is also prone to errors.
Various attempts have been made in recent years to solve the problem. However, none of these approaches succeeded in attracting the required critical mass of market participants.
history
The FpML standard was first published on June 9, 1999 by JPMorgan and PricewaterhouseCoopers International in the paper “Introducing FpML: A New Standard for E-commerce”. On November 14, 2001, the further development of FpML was transferred to an ISDA committee.
The current version FpML 4.1 was published in July 2005. This takes into account, among other things, FX transactions , interest rate swaps , credit default swaps , total return swaps and swaptions . The business processes included are: trading, valuation, confirmation, assignment, replenishment, amendment and termination.
Version 4.2 is currently being worked on. Among other things, the instruments inflation swap and asset swap as well as the business processes for the use of production factors , for point of view analysis and the formal definition of the roles of the parties involved should be included.