Derivatives - All Articles

  • SocGen hires ex-Jefferies banker for client coverage

    Société Générale has appointed Ashwan Malhotra as managing director in a bid to strengthen its client coverage in Asia Pacific.

    • 29 Jan 2016
  • Sour mood ruins rally in choppy week for European credit trading

    Credit markets endured another rollercoaster week as persistent nervousness prevailed over intermittent optimism and soured an earlier rally.

    • 28 Jan 2016
  • trueEX and SG score first with peso

    trueEX, a fast growing swap execution facility (SEF), has executed the first dealer to client Mexican peso interest rate swaps trades on its platform.

    • 28 Jan 2016
  • Regs causing options to diverge from wider market, fear traders

    Concerns are mounting among some US options market participants that regulation is having adverse effects on business and fuelling a rift between financial market performance and economic data.

    • 28 Jan 2016
  • E&P exposed as corp crude hedges falter

    A rally this week in crude oil has reduced short-term pressures, but exploration and production firms still face existential threats as liquidity and M&A odds worsen, said analysts.

    • 28 Jan 2016
  • Bank weakness opens up bond/CDS basis

    Last year the Markit iBoxx Euro Banks index was one of the outperforming bond sectors in Europe having returned 1%. The index, which is largely made up of bonds issued by European banks, even managed to outperform defensive sectors such as healthcare and utilities, while Europe’s regulatory oversight and relaxed monetary conditions kept market confidence in check.

    • 28 Jan 2016
  • UBS passes index control over to Markit

    UBS has asked Markit to administer and calculate its investible indices, as the bank looks to meet Europe’s regulatory push to improve transparency and oversight of industry benchmarks.

    • 28 Jan 2016
  • TriOptima completes inflation swaps tear-up

    TriOptima, the over-the-counter post-trade service provider, has completed its first compression cycle for inflation swaps, with 18 banks taking part.

    • 28 Jan 2016
  • Member states plead for more time for MiFID

    A fight between the European Commission and the member states of the Union could allow the Markets in Financial Instruments Directive II to split into myriad national interpretations — a nightmare for those trying to implement the complex new rules.

    • 28 Jan 2016
  • Syndicate veteran to run credit sales at Lloyds

    One of Lloyds Bank's most senior syndicate officials will switch jobs and run credit sales for the firm.

    • 28 Jan 2016
  • Regs causing US options to diverge from wider market, say traders

    Concerns are mounting among some US options market participants that regulation is having adverse effects on their business and fueling a rift between financial market performance and economic data.

    • 27 Jan 2016
  • Novel delay in Novo Banco CDS debate

    The International Swaps and Derivatives Association has extended the deadline for an external review panel to decide whether Novo Banco has triggered a credit event, adding to the protracted deliberations over the Portuguese bank.

    • 27 Jan 2016
  • Mizuho beefs up US equities with converts and derivs senior hires

    Mizuho Securities USA, the US investment banking subsidiary of Mizuho Financial Group has expanded its US equity platform with senior hires in equity derivatives and convertibles.

    • 27 Jan 2016
  • UBS places oversight of index business with Markit

    UBS has asked Markit to administer and calculate its investible indices, as the bank looks to meet Europe’s regulatory push to improve transparency and oversight of industry benchmarks.

    • 26 Jan 2016
  • ICE makes changes at the top as it looks to expand

    Intercontinental Exchange (ICE), looking to make acquisitions, has made senior management changes that include promoting its ICE Futures US chief operating officer to a newly created job.

    • 26 Jan 2016
  • Technicals are keeping derivative markets docile

    Markets are underpricing volatility, in stark contrast to 2015. As the underlying stock and bond markets gyrate, options markets show a strange tranquility. The market is better hedged than last year, but a flood of funds is suppressing fear signals.

    • 26 Jan 2016
  • Euronext preps sugar futures contract

    Euronext plans to launch a sugar futures contract later this year, as the European Union plans to abolish production quotas.

    • 26 Jan 2016
  • Missing extremes in derivatives hamper rebound

    US stock futures fell on Monday amid mixed markets, after Asian equities rallied but oil fell more than a dollar, to nearly $31 per barrel.

    • 25 Jan 2016
  • CFTC registers 18 SEFs, with five more on review

    The US Commodity Futures Trading Commission (CFTC) has granted full registration to 18 swap execution facilities (SEFs), upgrading them from the temporary registrations they held before.

    • 25 Jan 2016
  • CBOE takes majority stake in optons firm Vest

    The Chicago Board Options Exchange has bought an equity stake in Vest Financial Group, a firm that provides products to help investors hedge themselves using options.

    • 25 Jan 2016
  • A&M puts Abengoa in bondholders’ hands

    The opening shot for the race to save Abengoa from bankruptcy came on Monday from Alvarez & Marsal, the restructuring firm, and its plan to half the Spanish renewable energy company’s corporate debt to €4bn ­— now the board and creditors must approve the scheme before March 28.

    • 25 Jan 2016
  • ESMA delay leaves market facing swap margin chaos

    The biggest players in the international swaps market look to face an impossible race this year to meet European margin requirements, thanks to delays by regulators in putting the plans together.

    • 21 Jan 2016
  • Pain rises as credit goes past 2015 wides on options expiry

    Falling oil prices and China concerns sent credit spreads to the record wides of recent years this week as equity markets plummeted, with a credit index options expiry coming right at the sharp end of the spike and adding to the turmoil.

    • 21 Jan 2016
  • Oil drop chops digits from MLP yield reachers

    The latest push lower in oil prices caused additional pain for investors this week after forced liquidations in two levered exchange-traded notes (ETNs) linked to the energy sector locked in losses just as oil prices marked fresh multi-year lows.

    • 21 Jan 2016
  • Italy and China make worrisome bedfellows

    The economies of Italy and China do not appear to have much in common. Italy’s government would welcome a GDP growth rate of 1%, while China expands at less than 7% and investors take flight. One is a sclerotic, decaying Western country, the other is a dynamic Asian tiger. Such is the conventional wisdom.

    • 21 Jan 2016
  • Iran's bullish return puts pressure on oil and derivs traders on guard

    Iran's return to the world market is exacerbating pressure on oil prices and pushing commodity traders and producers to prepare for more disruption

    • 21 Jan 2016
  • HKEX plans expansion of China trading links

    The Hong Kong Stock Exchange plans to cement its position as the primary gateway between China and the rest of the world, after setting out a three-year strategic plan for 2016-2018.

    • 21 Jan 2016
  • Novo vote could undermine CDS, warn traders

    As a decision on whether Novo Banco has triggered a government intervention credit event heads to external review after weeks of ISDA Determinations Committee wrangling, some market participants are worried that a 'no' will reduce the value of financial credit default swaps, while others warn that a European-only result could open a rift with US contracts.

    • 20 Jan 2016
  • Saudi Arabia tries to stop riyal peg speculation

    Saudi Arabia’s central bank has told the country’s banks to stop selling options on riyal forwards — products which would let investors benefit if the value of the riyal falls.

    • 20 Jan 2016
  • Forcing dealer registrations would be counterproductive, warns ABA

    Forcing more companies to register as swap dealers would be "destabilising" to banks and "would undermine rather than promote proper risk management" among banks and their customers, according to counsel for the American Bankers Association.

    • 19 Jan 2016
  • Deutsche credit trading head set to exit

    Deutsche Bank is set to lose the head of its European investment grade credit trading business.

    • 19 Jan 2016
  • Breaking up the banks by the back door

    The Basel Committee’s new trading book rules don’t force banks to split into subsidiaries or to ringfence capital. But they will still revolutionise how investment banks run their trading businesses.

    • 19 Jan 2016
  • Iran's return sends derivs traders looking for shorts

    Derivatives traders are positioning for more pressure on crude oil prices as Iranian production comes on line and the global supply glut continues.

    • 19 Jan 2016
  • India clamps down on commodity trading as Iran opens up

    The Securities and Exchange Board of India (SEBI), the agency responsible for regulating commodity derivatives traded on Indian markets, has made several changes it said were designed to curb speculation and to reduce volatility in agricultural commodities.

    • 18 Jan 2016
  • Mizuho starts clearing derivatives

    As part of plans to grow its derivatives business, Mizuho International has begun to clear euro and dollar interest rate trades through LCH.Clearnet’s SwapClear.

    • 18 Jan 2016
  • Abengoa CDS settle low in first credit event auction of 2016

    Abengoa provided the first credit event auction of the year on Thursday and settled at a low price, after ISDA’s DC reached a split vote decision in December on the Spanish renewable energy company triggering a failure to pay trigger for 2014 credit default swap transactions.

    • 14 Jan 2016
  • Autos hard hit with credit nerves shredded

    Hitting record wides in credit default swaps, Glencore provided a focus of concern for the derivatives market this week but the autos sector also put in an alarming performance.

    • 14 Jan 2016
  • Changes for ISDA in testing week for CDS

    It has been a big week for the International Swaps and Derivatives Association. The organisation moved to overhaul its credit determinations committee rules and broaden its board representation at the same time as undertaking a widely watched first credit event auction of the year and heading into new territory with a Novo Banco CDS external review.

    • 14 Jan 2016
  • Sense of doubt keeps derivs returns limited

    Investor positioning and the composition of market flows this week suggest two things about returns over the near term: a sharp intraday sell-off like that in August is less likely, but so is a healthy rebound if Chinese catalysts fade from view, said analysts this week.

    • 14 Jan 2016
  • Deeper slump puts oil credits under pressure

    If European credit investors had to name two firms damaged by the precipitous fall in commodity prices, it is likely that Glencore and Anglo American would top the poll.

    • 14 Jan 2016
  • Love you till Tuesday: CFTC mulls reverse on 'arbitrary' swap rules

    The deadline for public comments on a key US swaps regulation is due on January 19 and, unless the Commodity Futures Trading Commission is swayed otherwise, “made up numbers” could drive costs higher for market participants.

    • 14 Jan 2016
  • Court rejects Deutsche Libor trader’s bonus claim

    The UK High Court has said that a former Deutsche Bank trader’s suit to claim crisis-era bonus payments “has no realistic prospect of success”.

    • 14 Jan 2016
  • Glencore launches one year loan as its CDS hits record wides

    Glencore launched its refinancing of a one year $8.45bn loan today (Thursday), which is hotly anticipated although the margin is set to widen as the company's credit spreads have surged to record levels.

    • 14 Jan 2016
  • ISDA puts out call for heroes to settle Novo CDS baffler

    ISDA, entering new territory, has asked members to help it put together an external review panel to resolve its deadlock over whether or not Novo Banco has triggered a credit event.

    • 13 Jan 2016
  • January rock 'n' roll prompts search for cheap hedges

    A tumultuous start to the year has made it more expensive to buy hedges, but strategists at banks in New York have some ideas to keep costs in check.

    • 13 Jan 2016
  • SGX preps LNG index swaps and futures

    Singapore Exchange will launch swaps and futures at the end of the month on its FOB SGX LNG Index Group (SLInG), a recently unveiled spot price index for Asian liquid natural gas.

    • 12 Jan 2016
  • Novo Banco CDS heads to external review as ISDA hits deadlock

    ISDA’s EMEA Determinations Committee has referred Novo Banco credit default swaps to an external review, after failing to achieve a “supermajority” with its binding vote on whether the Portuguese bank has triggered a government intervention credit event.

    • 12 Jan 2016
  • Abengoa CDS bidders revealed ahead of auction

    ISDA has released a list of participating bidders for the credit event auction on Thursday to settle Abengoa 2014 credit default swaps.

    • 12 Jan 2016
  • First Japanese aluminium futures trade on CME

    The first Aluminium Japan Premium Futures contracts traded on Friday, CME Group has said.

    • 12 Jan 2016
  • Margin dance: TriOptima makes OTC push

    TriOptima, the over-the-counter post-trade services provider, has teamed up with AcadiaSoft to launch a margin processing service, ahead of new rules on uncleared derivatives.

    • 12 Jan 2016
  • CFTC mulls reverse on “arbitrary” swap dealer rules

    The deadline for public comments on a key US swaps regulation is due next week and, unless the Commodity Futures Trading Commission is swayed otherwise, “made up numbers” could drive costs higher for market participants.

    • 12 Jan 2016
  • ISDA overhaul is grounds for dancing in the street

    The International Swaps and Derivatives Association (ISDA) pledged to tighten up the standards that govern its Credit Derivatives Determinations Committee, a welcome move at a time when the committee’s role is evolving and it is assuming greater importance as a quasi-legal authority.

    • 12 Jan 2016
  • Neuberger Berman hires options team from Horizon Kinetics

    Neuberger Berman, the independent and employee-owned investment manager, has acquired an investment team specialising in options from Horizon Kinetics.

    • 12 Jan 2016
  • Total Derivatives: Bid fades on easing yuan concerns

    The CNH-CNY FX gap has narrowed sharply in the wake of Monday's HIBOR fixing spike. In CNY swaps, easing concerns about further yuan depreciation have dampened short-end paying interest and the 1s/5s curve slope has steepened slightly, by Deirdre Yeung of Total Derivatives.

    • 12 Jan 2016
  • TABB boosts derivatives research with two hires

    TABB Group, a research and consulting firm focused on capital markets, has hired two analysts to its derivatives practice.

    • 11 Jan 2016
  • ISDA tightens up rules for determining credit events

    The International Swaps and Derivatives Association will tighten up the rules governing members of its Credit Derivatives Determinations Committee as it looks to strengthen the process for deciding whether credit events have occurred.

    • 11 Jan 2016
  • Yen futures reaction overblown: CFTC data

    Traders in yen futures may have overreacted to the growth concerns in China, data from the US Commodity Futures Trading Commission (CFTC) has suggested.

    • 11 Jan 2016
  • ISDA delays Novo Banco ruling for fourth time

    ISDA has extended until Friday its deadline to rule on whether Novo Banco has triggered a credit or succession event, after a fourth successive day of grappling with these questions failed to achieve an answer.

    • 11 Jan 2016
  • Markit buys Loan/Serv tech from DTCC to grow loan coverage

    Markit, the financial information services firm, has agreed to buy Loan/SERV technology assets from the Depository Trust & Clearing Corporation (DTCC) in a bid to expand its loan management services.

    • 11 Jan 2016
  • Total Derivatives: CNY Swaps: 5y well offered; CNH HIBOR spike

    5y CNY swaps have been well offered as Chinese equities continue their sell-off. In the short-end though, 1y swaps have been bid on concerns about the yuan. In Hong Kong today HIBOR spiked sharply on CNH liquidity tightness spurred by reports of indirect PBOC intervention, writes Deidre Yeung.

    • 11 Jan 2016
  • Novo Banco credit event stumps ISDA and lawyers

    The fate of credit default swaps referencing Novo Banco still hung in the balance on Friday, with ISDA’s Determinations Committee unable to decide after three days of wrangling whether the Portuguese bank had triggered a government intervention credit event or a succession event.

    • 08 Jan 2016
  • FlexTrade joins SEF drive with CFTC temporary approval

    FlexTrade, a New York based trading system provider, looks set to be the latest firm to join the growing field of swap execution facilities (SEFs), gaining a temporary registration from the US Commodity Futures Trading Commission.

    • 07 Jan 2016
  • Novo Bank bond debacle sends CDS soaring

    Back in August 2014, I wrote a note that highlighted how the restructuring of Banco Espirito Santo (BES) exposed flaws in the 2003 ISDA credit default swap definitions, flaws that should be remedied by the new definitions introduced later that year.

    • 07 Jan 2016
  • Hong Kong woes cause options price spike

    Options on Hong Kong-listed Chinese shares traded at one of the most expensive levels of relative value in recent history on Thursday as traders bid the premium for Hang Seng China Enterprises Index (HSCEI) contracts well above the recent realised volatility of the index.

    • 07 Jan 2016
  • Amid Mid East standoff, oil traders prep for the worst

    After a spike to start the week, three month option-implied volatility on WTI crude oil continued higher, reaching more than 47% annualised on Thursday as futures prices fell to fresh six year lows.

    • 07 Jan 2016
  • Updated: Banco Santander nabs ex-RBS loans bankers in Apac

    Two senior bankers from Royal Bank of Scotland’s defunct Asian loans division have moved to Banco Santander.

    • 07 Jan 2016
  • Options banner year as index and VIX demand surges

    2015 set a number of records in the options market as traders flocked to index and volatility-linked products, but equity options volumes dipped due to factors that look likely to persist in 2016.

    • 06 Jan 2016
  • As macro trading falters, is it time to embrace volatility?

    2015 will be remembered as a year when volatility returned to financial markets. With strong technical buffers to the trading range of US and European equity markets going into 2016, short volatility strategies look set to be compelling money earners in the year ahead, writes Andrew Barber.

    • 06 Jan 2016
  • Derivs traders position for more energy volatility and weakness

    Get bought or go bust: Is this the year when vulnerable oil & gas companies have to make the choice? So far this year, derivatives traders are pricing contracts for more vulnerability to come.

    • 06 Jan 2016
  • ISDA postpones Novo Banco credit event decision

    ISDA’s Determinations Committee has decided to hold a second day of discussions on Novo Banco, after failing to reach agreement on Wednesday over whether the Portuguese bank has triggered a government intervention credit event or a succession event.

    • 06 Jan 2016
  • Exchanges draw battle lines in regulatory crunch year

    Competition between derivatives exchanges is intensifying, giving rise to a rash of product and platform launches in 2015, as well as geographical expansion. But 2016 will be dominated by regulatory deadlines for electronic trading. As Dan Alderson reports, exchanges that best prepare market participants to meet these requirements will be the ones that will win out.

    • 06 Jan 2016
  • ISDA to weigh succession event for Novo Banco / BES

    ISDA’s Determinations Committee will meet at 12pm London time on Wednesday to decide whether Portugal’s Novo Banco has triggered a government intervention credit event, but will also deliberate a succession event in relation to the transfer of senior bonds to Banco Espirito Santo.

    • 05 Jan 2016
  • No auction for old Abengoa CDS

    The International Swaps and Derivatives Association this week published an initial list of 35 bonds to be considered as deliverables in the forthcoming Abengoa credit event auction, which will settle 2014 credit default swaps, but not updated 2003 transactions.

    • 05 Jan 2016
  • BGC enters derivs tear up with $800bn cull

    BGC Brokers, the interdealer broker, is making a push into the competitive world of over-the-counter derivatives portfolio compression and has already taken out over €800bn notional of swaptions.

    • 05 Jan 2016
  • Severed Middle East ties spark crude oil hedging cost spike

    Options traders took Monday's oil volatility seriously, sending prices for near-dated contracts to some of the highest levels of recent months.

    • 05 Jan 2016
  • Natixis boosts Apac presence with senior appointments

    French lender Natixis has bolstered its Asia Pacific team with a pair of senior appointments to its fixed income and equity units.

    • 05 Jan 2016
  • Rude restart for credit as global woes pile up

    Any hopes among European credit traders of easing back into 2016 with a peaceful first week were shattered from the outset on Monday, as spreads gapped wider due to China’s stock market woes and oil price volatility arising from Saudi Arabia’s new stand-off with Iran.

    • 04 Jan 2016
  • ISDA agrees to rule on Novo Banco credit event

    The International Swaps and Derivatives Association has accepted a request from investors to rule on whether Portugal’s Novo Banco has triggered a government intervention credit event.

    • 04 Jan 2016