Derivs - FX

Ex-Deutsche Bank interest rate staffers Paul Swaddling and David Martins da Silva have launched Prism Financial Products, a buyside brokerage. Christopher Rokos, the ex-co-founder of Brevan Howard, is also involved in the launch, according to a U.K. Companies House filing.

ANZ is looking to expand its fx and rates structured flow product business in Asia, diversifying products and hiring onshore sales staff in South Korea, Taiwan and potentially Indonesia.

Banco Bilbao Vizcaya Argentaria has tapped Mark Warms, ex-global head of sales at FXall, as head of fx sales U.S., based in Houston.

Recent press reports of Congressional and U.S. Commodity Futures Trading Commission investigations of possible price manipulations involving financial and energy assets have once again raised the question of what types of behavior constitute unlawful manipulation under the Commodity Exchange Act (CEA), which governs exchange and over-the-counter trading in a wide range of financial and commodities assets and values and can reach activities beyond U.S. borders.

The Hong Kong Securities and Futures Commission is leading the international charge to tackle cross-border extraterritoriality of global regulatory reforms stemming from the Pittsburgh G20 commitments, setting up a cross-border task force designed to bring industry and regulators together.

Fx vols have come under pressure and are being sold-off since because of the U.S. government shutdown and rising concerns over the debt ceiling.

Hedge funds that typically use fx options as part of their investment strategy are increasingly sitting on the sidelines or looking to equity derivatives as uncertainty over political issues globally increases.

Investors should look at going long the Indonesia rupiah against the U.S. dollar, selling three-month USD/IDR non-deliverable forwards at 11,520, targeting 10,500 and setting a stop at 12,400.

The recommendations of the U.K.’s Independent Commission on Banking chaired by Sir John Vickers published Sept. 2011 will have a profound effect on banking in the U.K.

Investors should look at playing the normalization and range trading of Hong Kong dollar, U.S. dollar spreads via a seven-year forward, three year HKD/USD swap spread, with an entry at -60 and taking profit at -25.

Australian counterparties registered as U.S. swap dealers started submitting over-the-counter interest rate swaps and credit derivative trade data to the Depository Trust & Clearing Corp. this week as part of the first phase of the Australian Securities and Investments Commission’s trade reporting roll out.

Investors globally have been unwinding bullish U.S. dollar options positions in the view that the U.S. currency is likely to come under pressure on the back of the government shutdown in the country, as concerns over the debt ceiling persist.