Markit has announced that its SovX CEEMEA credit derivatives index will start trading on 20 January.

The index forms part of the Markit iTraxx SovX family of sovereign credit default swap (“CDS”) indices and provides market participants with a standardised tool to hedge or gain exposure to the risk of fifteen countries in central and eastern Europe, the middle east and Africa.  The 15 countries represented in the index have a combined total outstanding CDS notional exposure of US$530 billion.

The index is an equally-weighted basket of 15 sovereign CDS referencing the following entities: Republic of Turkey; Russian Federation; Republic of Hungary; Republic of South Africa; Republic of Kazakhstan; Republic of Poland; Republic of Bulgaria; Romania; Republic of Croatia; Czech Republic; Republic of Latvia; State of Qatar; Emirate of Abu Dhabi; Ukraine; Republic of Lithuania.

Markit launched the four Markit iTraxx SovX indices in July 2009.  They track Western Europe, G7, CEEMEA and Global Liquid IG. The first of the indices to be traded was the Markit iTraxx SovX Western Europe index.