Institutional Investor (April 24)
To strengthen their balance sheets, large banks (including Deutsche Bank, Royal Bank of Scotland, UBS, Morgan Stanley, JPMorgan Chase and Barclays) have been reducing their commodities businesses, mainly through sales to independent trading companies. With these sales “to smaller players, conflicts of interest remain a potential problem” and nobody’s sure whether new problems will accompany this major shift. Given the skinnier balance sheets of the new players, market liquidity could conceivably suffer. In addition, “concerns abound that the underlying problems that have traditionally beset the commodities markets are simply being pushed onto a new and less tightly regulated set of actors.”
Tags: Balance sheets, Banks, Barclays, Commodities, Conflicts of interest, Deutsche Bank, JPMorgan Chase, Liquidity, Morgan Stanley, Regulated, Royal Bank of Scotland, Shift, Trading, UBS
Institutional Investor (March 19)
Volatility divides. Too much and it can be catastrophic. Too little and returns shrivel.” Increasingly investors are moving beyond hedging volatility to “trading volatility itself.” While specialists have been doing this for some time, trading volatility has “become more mainstream” since 2008 and the “go-to tool” many investors use to trade volatility is now “the VIX itself.”
Tags: Catastrophic, Hedging, Investors, Mainstream, Returns, Trading, VIX, Volatility
Euromoney (October Issue)
Warning some stock exchanges could face downgrades, ratings agency S&P cautioned that they “have become more prone to operational risk.” Fragmentation is one key challenge. “There are now 16 SEC-registered securities exchanges in the US and more than 50 alternative trading systems, whereas before 2005 the equities market was dominated by NYSE and Nasdaq. It is this interconnectivity that is fueling operational risk. When Nasdaq halted trading in August, for example, other stock exchanges, including NYSE, Bats and Direct Edge, were also forced to stop trading in Nasdaq-listed securities.”
Tags: BATS, Challenge, Direct Edge, Downgrades, Fragmentation, Interconnectivity, Nasdaq, NYSE, Operational risk, S&P, SEC, Securities, Stock exchanges, Trading, U.S.
Euromoney (October Issue)
“Today, Luxembourg’s streets are filling with Chinese bankers. They see the Grand Duchy as a hub for their European operations—not least for trading and settlement of the renminbi. Are London, Frankfurt and Paris in danger of being left behind?”
Tags: Chinese bankers, European operations, Frankfurt, Hub, London, Luxembourg, Paris, Renminbi, Settlement, Trading
Bloomberg (July 26)
“Everyone from officials at the U.S. Treasury to punters in London trading pits to salarymen in Osaka are so ecstatic to see a Japanese leader acting boldly that they’ve forgotten to study his strategy. It’s great that Abe wants to shake Japan Inc. out of two decades of complacency. It’s equally important, though, that his fixes are the right ones and are implemented carefully.”
Tags: Abe, Bold, Japan, Japan Inc., Leader, London, Osaka, Salarymen, Strategy, Trading, Treasury, U.S.
Institutional Investor (February Issue)
“For those who build and manage market and trading technologies, 2012 was punctuated by trouble. High-profile system malfunctions marred the BATS Global Markets and Facebook IPOs in March and May, respectively, and brought down market maker Knight Capital Group in August. These too were good new/bad news incidents, not as catastrophic as the still-reverberating ‘flash cash’ of May 6, 2010, but reminders that such technological snafus happen too frequently for comfort. All of this casts a pall over the industry and profession.”
Tags: BATS, Facebook, Flash crash, IPO, Knight Capital, Malfunctions, Technology, Trading
Bloomberg (April 20)
“The Tokyo Stock Exchange’s worst breakdown in six years has forced a rethink of the role alternative trading platforms play in ensuring that shares of some of the world’s biggest companies keep changing hands.” A February 2 computer glitch halted trading on many of the TSE’s biggest stocks. In the future, the Japan Securities Dealers Association will allow alternative trading platforms such as Chi-X Japan and SBI Japannext to continue trading if the TSE suffers another disruption. This will ensure that trading is possible even when the TSE breaks down.
“The Tokyo Stock Exchange’s worst breakdown in six years has forced a rethink of the role alternative trading platforms play in ensuring that shares of some of the world’s biggest companies keep changing hands.” A February 2 computer glitch halted trading on many of the TSE’s biggest stocks. In the future, the Japan Securities Dealers Association will allow alternative trading platforms such as Chi-X Japan and SBI Japannext to continue trading if the TSE suffers another disruption. This will ensure that trading is possible even when the TSE breaks down.
Tags: Chi-X Japan, Exchange, JSDA, SBI Japannext, Trading, TSE
