Derivatives - All Articles

  • More Than 90% Of IR Swaps Mis-Sold, Says FSA

    The U.K. Financial Services Authority says more than 90% of the interest rate swaps sold by big banks to small businesses did not comply with at least one or more regulatory requirements.

    • 31 Jan 2013
  • E.U. Lawmakers Warned Not To Vote Down Regs

    Michel Barnier, the European Union’s commissioner of internal markers, has written a letter to European lawmakers warning them not to vote down proposed derivatives regulations.

    • 31 Jan 2013
  • Big Banks May Pay GBP5 Bln Over IR Swaps

    Barclays, HSBC, Lloyds and the Royal Bank of Scotland may pay up to GBP5 billion (USD7.94 billion) to compensate small businesses that claim losses from interest-rate swaps mis-sold to them by the banks, according to analysts.

    • 31 Jan 2013
  • First S. African Bank Clears OTC Through LCH

    The corporate and investment banking unit of Apsa Bank has become the first local South African bank to clear derivatives through a central clearing counterparty, LCH. Clearnet.

    • 31 Jan 2013
  • CFTC To Study Swaps-To-Futures Shift

    The U.S. Commodity Futures Trading Commission will focus on the shift from swaps to futures as exchanges have set “extremely low threshold sizes for block trades in the futures contracts,” according to Scott O’Malia, a Republican member of the CFTC in a speech.

    • 31 Jan 2013
  • Canadian Bank Sells S&P-Linked Structured Note

    The Canadian Imperial Bank of Commerce has sold USD3.25 million for an 18-month structured note linked to the S&P 500, its first such offering in the U.S. in nearly nine years.

    • 31 Jan 2013
  • Canadian Bank Sells S&P-Linked Structured Note

    The Canadian Imperial Bank of Commerce has sold USD3.25 million for an 18-month structured note linked to the S&P 500, its first such offering in the U.S. in nearly nine years.

    • 31 Jan 2013
  • Widening iTraxx Opens Risk Reversal Opportunity

    The recent widening of the iTraxx Main has opened up the opportunity to take a bullish position on the index by selling a risk reversal.

    • 31 Jan 2013
  • Q&A: UBS’ Andrew Kaufmann

    Investors are moving away from three-to-five year 100% principal protected trades, and shifting into shorter tenors with less protection due to changes in interest rates, Andrew Kaufmann, global head of fx structuring at UBS in London, told DI in an interview.

    • 31 Jan 2013
  • Novel Collateralized Floating Rate Structure Surfaces

    UBS is marketing unique collateralized floating rate notes linked to three-month USD Libor and the credit risk of the Swiss Confederation—the first of their kind to be offered publically in Switzerland.

    • 31 Jan 2013
  • Ex-DB Fx Trader Joins Citi

    Prashant Puniya, ex-electronic trading fx options trader at Deutsche Bank in New York, has joined Citigroup as a G10 fx options trader. He is based in London.

    • 31 Jan 2013
  • SEC Directive Could Threaten Structured Product Issuers

    A forthcoming directive from the U.S. Securities and Exchange Commission that would require structured-product issuers to unbundle the fixed-income pricing element from the derivatives component, could drive consolidation of the market due to pricing pressures, according to buyers and attorneys.

    • 30 Jan 2013
  • Italy’s Central Bank, Regulator Drawn Into Derivatives Probe

    Italian prosecutors have begun investigating the Bank of Italy and market regulator Consob for their supervisory actions in connection with derivatives losses at Monte dei Paschi di Siena.

    • 30 Jan 2013
  • JPMorgan May Have Speculated Against CIO’s Trades

    Some of JPMorgan Chase’s own traders may have speculated against the derivatives trades that the bank’s chief investment office had made, which ultimately resulted in more than USD6.2 billion in losses.

    • 30 Jan 2013
  • GLG Fund Boosts CD Allocations

    Jon Mawby and Steve Roth, managers of GLG’s GLG Strategic Bond Fund, have boosted allocations to credit default swaps and floating rate notes, saying they are shifting away from exposures sensitive to duration to maintain an attractive yield.

    • 30 Jan 2013
  • Chesapeake CDS Tighten Sharply On CEO’s Exit

    Five-year credit default swaps on Chesapeake Energy narrowed by 72.5 basis point to 391.9 bps after the Oklahoma City-based firm announced that Aubrey McClendon will step down as ceo.

    • 30 Jan 2013
  • CFTC To Hold Public Roundtable On Regs

    The U.S. Commodity Futures Trading Commission is scheduled to hold a public roundtable Feb. 5 to discuss its proposed rule-making on enhancing protections for customers and customer funds held by futures commission merchants and derivatives clearing organizations.

    • 30 Jan 2013
  • Gold Vs. Dollar Kick-Out Note Surfaces

    UBS has launched a one-year kick-out note with a rebate that enables investors to benefit from the moderate appreciation of gold against the U.S. dollar.

    • 30 Jan 2013
  • BBVA Expands Equity Flow, Structured Biz

    Banco Bilbao Vizcaya Argentaria has expanded its equity derivatives flow and structured products capabilities in Europe to grow its distribution in the U.K., Switzerland, the Nordics and France.

    • 30 Jan 2013
  • Capula Pockets EM Fx Trader

    Capula Investment Management, the USD13 billion fixed income and currency focused hedge fund, has hired Gagandeep Singh an emerging markets fx options trader.

    • 30 Jan 2013
  • HKEx Lays Out Extended Futures Trading Plans

    The Hong Kong Exchange has presented its plans for after hours futures trading to the Legislative Council’s Panel on Financial Affairs.

    • 30 Jan 2013
  • Nomura Preps Japan ETN Program

    Nomura Securities plans to issue four exchange-traded notes from a new platform. The NEXT Notes will be issued Feb. 18 on the Tokyo Stock Exchange.

    • 30 Jan 2013
  • UBS Equity NY Sales Honcho Departs

    Jay Elkins, head of delta one sales for the Americas at UBS in New York, has left.

    • 29 Jan 2013
  • Indian Bourse To Launch Equity Derivatives

    India’s MCX Stock Exchange has announced that it will launch its equity and equity derivatives segment Feb. 9.

    • 29 Jan 2013
  • More Investors Switch From OTC To Futures

    Half of global institutional investors are opting for listed futures over over-the-counter derivatives as regulations make trading swap contracts more expensive, according to a UBS survey.

    • 29 Jan 2013
  • UBS Japan Derivatives Traders Set For H.K.

    UBS will relocate its Tokyo-based equities derivatives team to Hong Kong as part of its effort to reshape itself to better meet the needs of the market.

    • 29 Jan 2013
  • Nomura Mulls Downsizing Prop-Trading Unit

    Nomura is expected to decide in coming weeks whether to significantly downsize Angel Lane Principal Strategies, its proprietary-trading business.

    • 29 Jan 2013
  • Ex-SocGen Derivatives Chief Sues Over Firing, Bonus

    Folef Hooft Graafland, former director of Dutch derivatives trading at Société Générale in London, has sued the investment bank for what he claims is his unfair firing in February 2012 and withholding his bonus.

    • 29 Jan 2013
  • German Fixed-Income Fund To Use Derivatives

    German boutique Anetecedo Asset Management’s new Antecedo Euro Yield fixed-income fund will allocate roughly 1.9% of its assets to derivatives with the goal of beating the iBoxx Overall AAA-AA TR Index by 2% a year.

    • 29 Jan 2013
  • Irish Bank Sued Over Mis-Sold Derivatives

    Ulster Bank Ireland has been sued by investors for alleged mis-selling of interest-rate derivatives by the bank.

    • 29 Jan 2013
  • Schroders Loses Interest-Rates Chief

    David Scammell has left as head of U.K. and European interest-rate strategies at Schroders after eight years with the firm.

    • 29 Jan 2013
  • Bear Flatteners Touted On Rates Hike Expectations

    Front-end bear flatteners to position for U.S. interest rate hike expectations are being recommended by Barclays. According to the firm’s strategists, the trade would earn carry and is attractive at present on the back of recent demand for mid-expiry short tail options.

    • 29 Jan 2013
  • U.S. Fx Volumes Fall Again

    Average daily volume total for over-the-counter fx instruments in the U.S. has decreased by 7.7% since April 2012.

    • 29 Jan 2013
  • Japanese Tap Long-Dated Fx Structures

    Japanese retail investors are buying long-dated structured fx products, such as power reverse dual currency notes, that benefit when the yen weakens against the Australian dollar or, in some cases, the U.S. dollar.

    • 29 Jan 2013
  • Stock, Index Structures Take Off In Tokyo

    Knock-in, knock-out structured products linked to the Nikkei and single Japanese stocks are being snapped up as Japan’s equity market rebounds sharply.

    • 29 Jan 2013
  • Too many chiefs

    The loan market is groaning under the weight of ambitious lending banks hoping to participate at the very top level of transactions. But this surplus of senior lenders is symptomatic of a general overpopulation in the loan market that cannot last.

    • 29 Jan 2013
  • OTC Clearing Could Hurt Hedge Funds

    Central clearing of over-the-counter derivatives could have a significant negative impact on hedge funds, such as those that pursue relative value fixed income strategies, according Olivier Lebleu, head of non-U.S. distribution for Old Mutual Asset Management in London.

    • 28 Jan 2013
  • Regulators Urged To Cooperate On Cross-Border Swaps

    The Committee on Capital Markets Regulation has called on regulators in the U.S. and Europe to work together to resolve differences in their respective regulatory regimes for cross-border swaps “to avoid fragmentation” of the market.

    • 28 Jan 2013
  • B Of A Starts Moving Irish Trades To U.K.

    Bank of America has begun transferring more than USD50 billion of its Dublin-based derivatives business to its U.K. unit.

    • 28 Jan 2013
  • ICE To Seek E.U. Approval Of NYSE Euronext Deal

    Intercontinental Exchange is planning to seek approval for its proposed takeover of NYSE Euronext from the European Union antitrust officials, which last year rejected a similar proposed merger by Deutsche Boerse.

    • 28 Jan 2013
  • Sovereign CDS Narrow To Two-Year Low

    Credit default swaps on sovereign bonds have tightened to their lowest level in two years after central banks made securities safer by collectively pouring more than USD5 trillion since 2009 into the instruments, which helped raise ratings, according to data from Bloomberg and Bianco Research.

    • 28 Jan 2013
  • Most Firms Unprepared For OTC Regs

    Most financial institutions are unprepared for new over-the-counter regulations, according to IPC Systems.

    • 28 Jan 2013
  • Buffett Wanted Euronext To Ditch Derivatives Biz

    Warren Buffett’s Berkshire Hathaway has been identified as “Company A,” which last November made a bid to acquire NYSE Euronext—provided it sold its European derivatives business.

    • 28 Jan 2013
  • FSA Scheme May Not Help Mis-Selling Victims

    The Financial Services Authority’s scheme to compensate victims who were mis-sold interest-rate swaps by banks will not likely accomplish its goal, as “the banks themselves have been at the core of this process,” according to the U.K. Federation of Small Businesses.

    • 28 Jan 2013
  • LCH Hits USD500B In NDF Clearing

    LCH.Clearnet’s ForexClear platform has cleared USD500 billion of fx non-deliverable forwards since its launch last March.

    • 28 Jan 2013
  • Jarck Departs Deutsche Bank

    Thomas Jarck, managing director and head of U.S. index flow trading in global equity derivatives at Deutsche Bank in New York, has left the firm.

    • 28 Jan 2013
  • CMBX Index Makes Debut

    A new synthetic commercial mortgage-backed securities index referencing 25 conduit offerings from 2012 began trading on Friday.

    • 28 Jan 2013
  • EFG FP Plots White Labeling Push

    EFG Financial Products is to expand its white labeling structured products business this year. The move is on the back of its initial public offering in Q4 that saw EFG International reduce its stake in the investor products provider from around 58% to around 25%, setting the structured products provider as a more standalone operation from its global private banking parent.

    • 28 Jan 2013
  • Asia Investors Tap Vol Via Upside Calls

    Investors in Asia are buying volatility via upside calls on U.S. and Chinese stocks as sentiment improves in the U.S. and Asian markets.

    • 28 Jan 2013
  • MS Adds HK Index Trader

    Morgan Stanley has hired Yuichi Yamashita, an ex-v.p. and index arbitrage trader at Société Générale in Hong Kong.

    • 28 Jan 2013
  • Global Sovereign CDS Prices Narrow 16% In Q4

    Global sovereign credit default swaps prices narrowed 16% in the fourth quarter, according to CMA’s Global Sovereign Debt Credit Risk Report.

    • 25 Jan 2013
  • Japan Corporate CDS Tighten To 17-Month Low

    Credit default swap spreads on Japanese corporate bonds narrowed 5 basis points to 134.5 bps, their lowest level since August 2011.

    • 25 Jan 2013
  • Lawmaker Proposes Changes To Taxes On Derivatives

    Dave Camp, the chairman of the House Ways and Means Committee, has released a discussion draft proposing an overhaul to tax rules as they apply to derivatives and other financial instruments.

    • 25 Jan 2013
  • CFTC Approves LCH Revisions

    The U.S. Commodity Futures Trading Commission has approved LCH.Clearnet’s revised rulebook and an amended order of registration as a derivatives clearing organization.

    • 25 Jan 2013
  • Obama Names SEC, CFPB Picks

    President Barack Obama has nominated Mary Jo White as chairman of the U.S. Securities and Exchange Commission and renominated Richard Cordray as director of the U.S. Consumer Financial Protection Bureau.

    • 25 Jan 2013
  • Republican CFTC Commissioner Resigns

    Jill Sommers, one of the two Republican commissioners at the U.S. Commodity Futures Trading Commission, is resigning after the end of the current quarter.

    • 25 Jan 2013
  • Deutsche Bank Claws Back Prop Trader’s Bonus

    Deutsche Bank has clawed back roughly EUR40 million (USD53.8 million) in bonuses awarded to proprietary trader Christian Bittar after he was terminated in December 2011 for allegedly trying to manipulate the euro interbank offered rate.

    • 25 Jan 2013
  • SEC Initial Margin Proposals To Hit Hedging

    Initial margin requirements in proposals from the Securities and Exchange Commission would curtail the use of uncleared swaps for hedging and challenge the resilience of the financial system.

    • 25 Jan 2013
  • “[Moving trades] is certainly harder than it sounds. There are issues relating to regulatory capital, there are issues relating to the banks own internal reporting lines, and then there are issues that are a bit more parochial like bonus pools that really do get affected by moving trades around the network.”

    —Stephen Fiamma, partner at Allen & Overy in London, on issues surrounding Hong Kong’s Foreign Account Tax Compliance Act.

    • 25 Jan 2013
  • People Databank

    The slew of departures continued into the third week of January as various investment banks saw more staffers exit across all asset classes. UBS’s hedge fund prime brokerage service, UBS Quant HQ, lost its global head of the division Scott Stickler.

    • 25 Jan 2013
  • Instability Puts Slovenia On The Trading Radar

    Slovenia is not one of the more popular names in the sovereign credit default swap universe, but it has been seeing some activity in recent weeks due to political instability.

    • 25 Jan 2013
  • Buysiders Scoop Credit Payer Spreads

    Hedge funds and asset managers have been using credit options, such as payer spreads, to participate in a market correction in the iTraxx Main and iTraxx Senior Financials.

    • 25 Jan 2013
  • UBS Plots China Equities, Structured Product Push

    UBS Securities is planning to offer onshore total return swaps referencing Chinese A-shares when the authorities greenlight the upcoming over-the-counter equity derivatives market.

    • 25 Jan 2013
  • EMIR: The ESMA FAQ

    The European Securities & Markets Authority published ‘EMIR: Frequently Asked Questions’ to “provide clarity” in relation to the European Market Infrastructure Regulation. This FAQ article covers the position prior to scrutiny of the EMIR Technical Standards by the European Parliament and Council of the E.U.”

    • 24 Jan 2013
  • Italian Bank May Face USD956 Mln Loss From Derivatives

    Italy’s Banca Monte dei Paschi di Siena said it could post losses of as much as USD956 million on past derivatives trades, which the bank’s new management has recently uncovered.

    • 24 Jan 2013
  • SEC Criticizes IOSCO Guidelines

    The U.S. Securities and Exchange Commission has criticized the International Organization of Securities Commissions’ latest guidelines for complex financial products, saying the report “does not accurately reflect the relevant law in the U.S.”

    • 24 Jan 2013
  • Incapital Pulls Out Of Europe

    Incapital’s structured product provider Incapital Europe is pulling out of the European market.

    • 24 Jan 2013
  • U.K. Probing ICAP Over Libor

    The U.K.’s Financial Services Authority has been investigating interdealer-broker ICAP as part of its probe of manipulation of the London interbank offered rate.

    • 24 Jan 2013
  • BlackRock Volatility Fund To Invest In Derivatives

    BlackRock’s new Managed Volatility VI Fund, aimed at insurers, will invest in derivatives and individual securities as well as unaffiliated mutual funds and exchange traded funds.

    • 24 Jan 2013
  • Equinix To Host Nasdaq Derivatives Market

    Nasdaq OMX has retained data center Equinix to host Nasdaq OMX NLX, the exchange’s European derivatives market.

    • 24 Jan 2013
  • Pimco To Limit Derivatives

    Pimco founder and co-cio Bill Gross said his firm will limit its use of derivatives, noting that their advantage has diminished over time.

    • 24 Jan 2013
  • Fewer Than Half Of Dodd-Frank Rules Completed

    Fewer than half of the regulations under the Dodd-Frank Act have been finished by the five regulators responsible for writing them, according to a report from the U.S. Government Accountability Office.

    • 24 Jan 2013
  • Firms Flip HK Trades To London To Avoid Tax Act

    Some dealers have started booking in London some derivatives that would normally have been booked in Hong Kong to avoid facing compliance problems under the Foreign Account Tax Compliance Act.

    • 24 Jan 2013
  • Shanghai CCP Set To Start

    The Shanghai Clearing House is ready to launch its central clearing counterparty for over-the-counter derivatives, with clearing of onshore yuan-denominated interest rate swaps to start soon.

    • 24 Jan 2013
  • BNP Touts Curve Steepeners Following BoJ Stimulus

    Investors should consider buying dividend curve steepeners referencing the Nikkei in a bid to benefit from the Bank of Japan stimulus measures announced this week.

    • 24 Jan 2013
  • E.U. Pols Object To ESMA Clearing Threshold

    A majority of the European Parliament’s Economic and Monetary Affairs Committee is against European Securities and Markets Authority clearing threshold proposals for non-financial counterparties.

    • 23 Jan 2013
  • Listed Derivatives Drop Sharply In 2012

    Listed equity derivatives volumes dropped 14.9% in 2012 to 14.9 million, while the overall volumes of securitized derivatives plunged 43.3%, even as the number of listings grew by 16.2%, according to the World Federation of Exchanges.

    • 23 Jan 2013
  • CDS On Core-European Sovereigns Down 30%

    The volume of credit default swaps on core-European sovereigns has fallen 30% since last August, according to JPMorgan.

    • 23 Jan 2013
  • Philippines Reviews Basel’s OTC Regs

    The Bangko Sentral ng Pilipinas is reviewing over-the-counter derivatives regulations adopted by the Basel Committee on Banking Supervision with an eye toward how to comply with them.

    • 23 Jan 2013
  • CDS On Core-European Sovereigns Down 30%

    The volume of credit default swaps on core-European sovereigns has fallen 30% since last August, according to JPMorgan.

    • 23 Jan 2013
  • Merchant Structured-Product Arm To Enter Liquidation

    Structured product provider Merchant Capital will likely be placed in liquidation within the next two weeks.

    • 23 Jan 2013
  • Italian Banking Group Chiefs Quits Over Derivatives Losses

    Giuseppe Mussari, former chairman of Banca Monte dei Paschi di Siena, has resigned as president of the Italian Banking Association after Monte has come under pressure to disclose the extent of losses from derivatives that it entered into with Deutsche Bank.

    • 23 Jan 2013
  • Derivatives Drive SGX’s Profit

    A 30% increase in derivatives trading helped drive up net profits at the Singapore Exchange in the most recent quarter by 17%.

    • 23 Jan 2013
  • SEC Names Market-Intelligence Chief

    The U.S. Securities and Exchange Commission has appointed Vincente Martinez as chief of the Enforcement Division’s Office of Market Intelligence.

    • 23 Jan 2013
  • CFTC Extends CME Comment Period

    The U.S. Commodity Futures Trading Commission has extended for 45 days the comment period on a proposal by CME Group relating to swaps reporting.

    • 23 Jan 2013
  • UBS Hedge Fund Service Chief Exits

    Scott Stickler, global head of UBS’ hedge fund prime brokerage service in New York, has left the firm.

    • 23 Jan 2013
  • EUSIPA Rips Investor Documentation Proposals

    Proposals from the European Parliament’s Economic and Monetary Affairs Committee to establish key information documents alongside investment products would hamper innovation and could freeze markets, according to the European Structured Investment Products Association, in a response.

    • 23 Jan 2013
  • BNP Singapore Rates Trading Chief Leaves

    Chee Chen Poh, a managing director in fixed income trading at BNP Paribas in Singapore, left the firm last week.

    • 23 Jan 2013
  • FINRA Targets Broker-Dealers Over Options Trading

    The Financial Industry Regulatory Authority has begun reviewing the activities of broker-dealers and firms that trade options to determine whether their electronic-trading practices may have helped them avoid fees due to exchanges.

    • 22 Jan 2013
  • Nomura, Italian Bank Dispute Derivatives Deal

    Banca Monte dei Paschi di Siena has denied comments by Nomura that top officials of the Italian bank reviewed and approved a derivatives deal that eventually resulted in a loss of EUR220 million (USD292.8 million)last year.

    • 22 Jan 2013
  • Black Rock EM Fund To Use Derivatives

    BlackRock’s new Strategic Funds Emerging Markets Absolute Return Fund will invest at least 70% of its assets in equities, derivatives and other equity-related securities.

    • 22 Jan 2013
  • CFTC TO Hold Swaps Roundtable

    The U.S. Commodity Futures Trading Commission has scheduled for Jan. 31 a public roundtable to discuss the so-called “futurization” of the swaps market. Topics to be discussed include, among others, clearing

    • 22 Jan 2013
  • Odey Fund To Invest In Derivatives

    Odey Asset Management has launched the Dublin-domiciled Odey Orion Fund, which will be able to invest in derivatives as well as equities, commodities and currencies, among other instruments.

    • 22 Jan 2013
  • RBS Backs Baht Receiver Swaption Play

    Lower rates and attractive levels of volatility on the Thai baht swap curve give investors the opportunity to buy 1y2y 3.25% receiver swaptions, according to the Royal Bank of Scotland.

    • 22 Jan 2013
  • RBS Eyes Rates For Structured E-Platform

    MarketDirect, the Royal Bank of Scotland’s electronic structured products platform, plans to offer interest rate products to clients later this year. The move comes as single dealer and multi-dealer platforms are expanding offerings via electronic execution.

    • 22 Jan 2013
  • E.U. Greenlights Transaction Tax

    European Union finance ministers have given permission to France, Germany and nine other bloc countries to proceed with financial transaction taxes that would apply to derivatives and other complex financial products.

    • 22 Jan 2013
  • HK Structurer Departs RBS

    Paul Thind, head of custom indices Asia Pacific at the Royal Bank of Scotland in Hong Kong, left the firm last month.

    • 22 Jan 2013
  • Asia Investors Wait On BoJ Reaction

    Investors in Asia were awaiting reaction market in New York and London before putting on fx option trades following the Bank of Japan’s announcement Tuesday that it plans to target an inflation rate of 2%.

    • 22 Jan 2013
  • UniCredit Emerging Markets Bigwig To Join Sberbank

    Bill Beller, head of Eastern Europe, Middle East and Africa equity derivatives flow trading at UniCredit in London, has left the firm and is set to join Sberbank as head of equity options trading in Moscow. Sberbank is Russia’s largest commercial bank

    • 22 Jan 2013
  • MS Loses Two More From Fx Sales And Trading

    Morgan Stanley has lost two more from its fx sales and trading desk in Singapore and Hong Kong, with Zachary Heng and Supat Julsiri leaving recently.

    • 22 Jan 2013