Derivs - FX

The potential for regulatory arbitrage over margins for contracts that are not centrally cleared, such as fx derivatives in the U.S., is a serious issue, according to Steven Maijoor, chair of the European Securities and Markets Authority.

End users in Japan have bought about USD1 billion in short-dated out-of-the-money U.S. dollar calls against the yen within the last two weeks.

­Members of the European parliament are undecided over the makeup of a potential E.U. financial transaction tax and whether it would benefit or damage the economy.

High volatility in the fx markets is being blamed for a recent decrease in average daily trading of over-the-counter fx swaps in Singapore.

The average daily U.K. foreign exchange turnover in October 2011 fell 3% from April 2011, driven by a 9% fall in fx swaps trading, according to a report released today.

Clearing of over-the-counter interest rate swaps via Singapore Exchange’s central clearing counterparty DerivativesClear rose in January for the first time in three months to SGD12.92 billion (USD10.34), from SGD1.26 billion (USD1.01) in December.

Australia’s legal definitions for derivatives are working effectively and should not be simplified further through changes to the nation's main financial markets law, according to the Corporations and Markets Advisory Committee.

Hedge funds are showing interest in topside U.S. dollar/yen options this week as the dollar flirts with all-time lows, sparking speculation that the Bank of Japan will intervene to weaken the yen over the short-term, according to traders.

Investors should buy dual digital options on the Australian dollar/U.S. dollar against the USD/Mexican peso, according to strategists at Société Générale.

Malaysia’s central bank, Bank Negara Malaysia, is liberalizing its fx and interest rate derivatives markets.

Investors eyeing equity dislocations should position themselves long volatility on the Bovespa Brazil Sao Paulo stock exchange index and short volatility on the Brazilian real/U.S. dollar cross, say strategists from Barclays Capital in New York.

Investors eyeing equity dislocations should position themselves long volatility on the Bovespa Brazil Sao Paulo stock exchange index and short volatility on the Brazilian real/U.S. dollar cross, say strategists from Barclays Capital in New York.