Derivs - Equity

Bank of China is issuing an equity-linked structured product to retail investors in Hong Kong that uses over-the-counter put options—its first this year.

Concerns over margin requirements set by clearinghouses and central counterparties were a key concern expressed by attendees at the International Swaps and Derivatives Association’s 27th Annual General Meeting in Chicago.

The Commodity Futures Trading Commission will complete the 20 outstanding rules as mandated by the Dodd-Frank Act by this year, said CFTC chairman Gary Gensler, speaking at the International Swaps and Derivatives Association 27th Annual General Meeting in Chicago.

The over-the-counter equity swaps market, a small one by volume but important for dealers in terms of providing one-off trading needs to customers, could be in trouble once the Dodd-Frank clearing mandate kicks in.

U.S. prudential regulators need to provide more clarity to end users as to whether or not firms will be able to net exposures across cleared and uncleared swaps, or swaps that are monitored by different regulators, said Ted Macdonald, managing director and treasurer at D.E. Shaw on a panel today.

Stephen O'Connor, chairman of the International Swaps and Derivatives Association and managing director of over-the-counter client clearing at Morgan Stanley, has called for uniform derivatives regulations in an attempt to ease extraterritoriality concerns.

Thomas Nahm, head of equity exotics trading at the Royal Bank of Scotland in London, has left the firm.

Michael Riley, co-head of equity derivatives trading for the Americas at UBS in Stamford, Conn., has left the firm.

Goldman Sachs is set to roll-out a structured note that combines exposure to equities, commodities, currencies, and Treasury bonds in what is known as a best-of basket format. Such structures are rarely seen in U.S. structured products.

Hedge funds have been buying novel cross-asset dispersion structures on the S&P 500 and euro/U.S. dollar, playing the view the underlyings will both stay range bound. The thinking is sovereign debt concerns in Spain and Italy will be cleaned up by the European Central Bank, resulting in little to no risk of a tail event coming out of Europe.

Craig James, a former director in equity derivative trading at Deutsche Bank in New York, has launched a hedge fund in Hong Kong.

Julien Petit-Pasquier, the ex-head of index trading at Daiwa Capital Markets in Hong Kong, is set to join Barclays Capital as a director in equity index trading.