Derivs - FX

EBS Market, the electronic fx platform owned by ICAP, has named Nichola Hunter and John Schoen as co-heads of the platform, in two newly created roles.

Volatility overlay strategies are likely to increase this year as investors look to strategies providing downside protection and income generation in the current low yield environment, Nancy Davis, director of derivatives at AllianceBernstein in New York, told DI.

Interest is increasing in structured notes bullish on a basket of emerging market currencies against the yen, as opposed to the more regularly traded baskets against U.S. dollar or euro.

Japanese investment firms have either already registered as major swap participants, or are in the midst of preparing to register with the U.S. Commodity Futures Trading Commission as they near the USD8 billion swap position threshold set by the regulator.

Staffers working in derivatives units at European banks in the U.S. and Asia Pacific would be hit hard should restrictions surrounding bonus payouts from the European Union go into force.

Munich-based Assenagon Asset Management, which manages assets of more than EUR10 billion, is set to launch a credit selection fund that invests in corporate bonds and default swaps.

Singapore began its over-the-counter derivatives reform program in July 2011 when the Monetary Authority of Singapore, the central bank and financial services regulator, announced it would meet the objectives set by the G-20 in Pittsburgh in Sept. 2009 as well as the recommendations of the Financial Stability Board set out in its report to the G-20 Finance Ministers and Central Bank Governors in Oct. 2010. Although not a member of the G-20, Singapore is a member of the FSB.

LCH.Clearnet has tapped David Weisbrod for a newly-created role as ceo of its U.S. subsidiary, based in New York.

Capped downside structures like double-no-touches are expected to gain traction as correlation increases and volatility decreases between sterling and commodity currencies, such as the Canadian dollar and Australian dollar.

Private banks have been buying one-year U.S. dollar, offshore China yuan-linked digital put options with a strike of 1% below spot.

Citigroup will be adding multi-leg options to its fx electronic trading platform Velocity in the next few weeks.

As the basket into which trillions of dollars worth of eggs, in the form of OTC derivatives, must eventually be crammed, central clearing counterparties have the potential to become the world's biggest too-big-too-fail institutions.