N.Y. systems firm releases new software for trading.

Merrin Financial Inc., a New York City-based financial systems developer, has added a mortgage-backed securities module to its trading software.

The module gives portfolio managers and traders the ability to trade and manage all mortgage-backed securities, collateralized mortgage obligations, and asset-backed securities.

The module comes with a feature that enables traders to update "to be announced" transactions with specific pool information.

The system also will check for "good delivery" in accordance with the Public Securities Association before automatically canceling previous trade information.

Seth Merrin, president of Merrin Financial, said that this feature is different from current "to be announced" trading methods which are manually driven.

He said that traders typically buy and sell pools of mortgage-backed securities on the basis of "to be announced" information. Once a final figure for the pool is announced, they must pull up each individual account and manually calculate how the new settlement information will affect each account.

At most firms, that information must then be written on paper tickets and passed off to an accounting clerk, who then enters the new information into a separate system. "In a more manual environment, traders spend a lot of time inputting traders and cancellations. It's a time-consuming and antiquated process," Mr. Merrin said.

Speed Critical

With the Merrin module, canceling and rebooking a such a mortgage-backed transaction is automatic.

Mr. Merrin said that this speed is critical on "announce days," the time when pool selection is made and when final prices are posted. In addition, the new module comes with an order entry facility that books traders to multiple accounts.

It also electronically calculates the settlement date for agency trades using the PSA settlement calendar. In the coming months, Merrin will provide a "to be announced" turnaround processing facility that will allow traders to quickly match similar buy and sell transactions.

It also will assign the same specific pool information from the buy transaction to the sell transaction.

Ms. Sullivan is a freelance writer based in New York.

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