Derivs - Credit

In recent years, the credit markets have become accustomed to volatility, despite the best efforts of central banks to tame the beast. But where it was sovereigns and banks that were the instigators during the crises of 2007-2012, in 2015 it is the commodities sector that is providing the oscillations.

On Thursday, September 24, GlobalCapital held its 2015 Global Derivatives Dinner at Banking Hall in London and revealed the winners of its Global Derivatives Awards 2015.

After an explosive month in August, implied volatilities for many currency pairs remained subdued in the wake of the last Thursday's US Federal Open Market Committee decision to leave rates unchanged.

Volkswagen credit spreads more than tripled this week and other European automotive names moved sharply wider but some traders and strategists called it a knee-jerk reaction that is likely to be corrected soon.

German corporate credit, generally regarded as a safe bet, has had a torrid time of late. Last week we looked at how the costs of transitioning from nuclear to clean energy had inflicted damage on German utilities and sent credit spreads spiralling wider. This week it was the turn of the automotive industry, and Germany’s largest car producer: Volkswagen.

Royal Bank of Scotland has undertaken a shakeup of senior staff in its credit trading business, in a move that bolsters financials at the expense of corporate credit.

The International Swaps and Derivatives Association ruled on Wednesday that Ukraine has not triggered a repudiation/moratorium credit event following the country’s recent decision to freeze payments on debt.

UBS has hired an emerging market credit sales specialist to its office in London.

A near tripling of Volkswagen credit spreads on Monday and Tuesday this week, along with a sharp widening of other names in the European autos sector, is a kneejerk reaction that is likely to be corrected soon, according to some traders and strategists.

An eagerness among buyside credit traders to sell credit volatility at the start of the week gave way to hedge buying by Wednesday, as iTraxx index spreads hit their recent wides.

JP Morgan Asset Management has hired an experienced high yield credit portfolio manager to its JPS Credit Opportunities Fund.

ING has hired an experienced salesperson to help coordinate the development of its high yield business in London.