Derivs - Interest Rate

James Kelly, a former managing director at Goldman Sachs in derivatives sales management for U.K. clients, institutions and hedge funds, has joined the U.K. Financial Conduct Authority as an advisor in the wholesale banking and investment management division within supervision.

Approximately 90% of clearable over-the-counter interest rate derivatives have been cleared according to data analyzed by the International Swaps and Derivatives Association as of June 30, 2013.

Barclays is recommending selling euro 5y*5y payers on a delta-hedged basis, as investors will likely continue to sell options in a search for yield in the low rate and tight credit spread environment.

R. Martin Chavez, chief information officer for Goldman Sachs in New York, will receive the Outstanding Contribution Award at the Americas Derivatives Awards on April 22. Chavez, who was selected for the award by senior buyside and sellside officials active in the derivatives markets, will be honoured for his contribution to the development of the derivatives market through his role at the International Swaps and Derivatives Association, as well as his success in developing Goldman’s Equities Franchise, among other areas. The full list of award categories and nominees can be accessed at www.derivativesweek.com.

NYSE Liffe had a record month in short term interest rate futures in June 2013, with combined volumes for short sterling and Euribor futures exceeding the previous record of January 2013 by almost 10%. The record day for volumes of STIR futures on Euribor came on Jan. 25, 2013, at 3.2 million lots.

Barclays strategists are recommending investors sell EUR high-strike payers to position for underperformance in long-dated vol on the back of increased structured note issuance during the current quarter.

Regulatory concerns and increased complexity in institutional investor portfolios relating to the use of an ultimate forward rate curve is driving increased appetite for liability driven investments, according to ING Investment International.

The Australian Securities and Investments Commission is considering waiving specific trade reporting requirements for international firms active in the over-the-counter derivatives market, and is currently in discussions with market participants over the issue.

Newly created domestic central counterparties in Asia may largely lose out to international CCPs following the introduction of mandatory clearing this year.

DBS Bank in Hong Kong is looking to market equity-linked notes denominated in renminbi that reference an equity underlying in Hong Kong. The issuance is based on the view that there will likely be a relaxation in RMB convertibility, which will spur demand for such structures.

Insight Investment has appointed Tarik Ben-Saud, the ex-head of liability-driven investment and client strategy at BlackRock, as head of asset solutions.

The Australian Securities Exchange plans to introduce client clearing to its over-the-counter derivative central counterparty in April, and will be working to expand its product offering throughout the year.