Abstract: A method and arrangement for the organization and structure of a derivative counterparty which is formed to facilitate hedging and derivative transactions, including swap transactions, in which the method includes establishing a counterparty entity as a joint venture between the customer and a plurality of common members, providing a portion of capital to the counterparty entity from each of the plurality of common members and the customer, providing another portion of the capital to the counterparty, and purchasing assets for executing a derivative transaction between the counterparty and the customer using the capital provided to the counterparty, in which operations of the counterparty are economically and/or financially independent of the plurality of common members and the customer.