Markit Group Limited is in the process of completing two index acquisitions, bringing some consolidation to the credit derivative index industry.

Earlier this month, the data vendor completed the acquisition of International Index Company Ltd. (IIC), the provider of the iTraxx credit derivative indexes and the iBOXX family of bond indexes. Before the end of the year, Markit expects to have completed the acquisition of a second index provider—CDS IndexCo LLC, the provider of the CDX credit derivative indexes and a family of synthetic structured finance and loan indexes. Credit derivatives are agreements between two parties to trade the risk of default on a credit obligation.

On one level, not a lot is changing in the alternative index world, as Markit was already providing a variety of administrative, marketing and data services to the acquisition targets. Among the firm's owners are JPMorgan Chase & Co., Morgan Stanley and Deutsche Bank; those banks are also members of the respective consortiums of banks that own IIC and CDS IndexCo.

However, the acquisitions mean the two best-known index families covering credit derivatives will be brought under the same roof. While the iTraxx family mainly covers Europe and Asia, the CDX family's coverage includes emerging markets and North America, which raises the possibility of the creation of a global credit derivative index under the Markit brand name.   

Stephan Flagel, who was previously the chief operating officer of global research at Barclays Capital, is the head of Markit's new index group.