Derivs - Credit

Investors should look at buying three-month U.S. dollar, Japanese yen condor options with strikes at 100-104-106-110 in order to benefit from the next round of yen weakness, according to strategists at Société Générale.

Fix Trading Community has updated guidelines on the electronic trading of swaps and bonds using the FIX messaging standard.

With U.S. forward rates close to returning to normalized levels, Credit Suisse expects a further substantial sell-off to be led by the shorter end of the curve, and is therefore touting being short 1y1y against 5y5y conditionally, via three-month mid-curve payers.

Investors should expect a more muted widening when the CDX.NA.HY index rolls into series 21 on Sept. 27.

Should derivatives regulation differ between provinces in Canada, then it could result in market participants having to comply with rules in more than one province and disincentivize dealers from transacting with counterparties based in Canada, according to market participants. Regulators in Canada, however, are aiming for the provincial rules to be identical.

Electronic over-the-counter market operator Tradeweb Markets has hired Nomura’s former Global Head of Spread Product Sales Cactus Raazi as head of North American credit. Raazi, who left Nomura Nov. 2012, joined this month. Raazi declined comment.

Global credit markets witnessed an unprecedented week, which woke them up from their U.S. Federal Reserve quantitative easing tapering nightmares.

Obtaining high-quality assets to use as collateral may be destructive to the markets in which they are being used and they’ll be costly to get hold of, according to Michael Clarke, managing director at Goldman Sachs.

Market participants are likely to continue using streaming prices and request-for-quote when credit derivatives are mandated to be traded on swap execution facilities, as opposed to trading on a central limit order book, according to panelists at the International Swaps and Derivatives Association’s Annual North America Conference in New York on Thursday.

The market needs to ensure greater margin efficiency for buyside firms to produce returns for their clients, while the introduction of swap execution facilities is leaving buysiders with greater risk, according to Richard Prager, board member at the International Swaps and Derivatives Association and head of global trading at BlackRock.

Gerhard Seebacher, global co-head of fixed income, currencies and commodities trading at Bank of America Merrill Lynch in New York, is retiring from the firm at the end of the month.

Investors are unwinding, but not replacing, out-of-the-money payer spreads on the iTraxx Main ahead of the roll of the index.