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Appleton Capital Management plans to launch a fixed-income arbitrage and an equity market-neutral hedge fund. Both funds will use the full remit of listed and over-the-counter derivatives, according to Jeremy O'Friel, head of marketing in Dublin.

HSBC has hired David Choi, head of interest-rate derivatives trading at Citibank in Seoul, in a similar role at the bank, according to market officials. "They're continuing to build up," said one official, adding that HSBC has been looking to build up its presence in Korea on the back of a burgeoning interest-rate derivatives market. Choi will report to Ian Banks, treasurer at HSBC in Seoul. Banks declined all comment and Choi, who starts today, could not be reached for comment.

The cost of dollar/euro options fell slightly last week as the greenback strengthened against the single currency, according to foreign exchange options professionals. One-month implied volatility fell to 12.25% by late Wednesday in New York, down from 13% earlier in the week. The inverse relationship between vol and the euro/dollar spot held true, as the dollar gained back some ground with spot at USD1.05 by Wednesday. It had been has high as USD1.15 earlier in the week, after the euro hit parity the previous Sunday. "I wouldn't use the word 'comfortable,' but the market is used to this situation now and we will need to see a breakout above USD1.2 to get vols much higher," said an fx options trader in New York. A common trade was for investors to purchase euro calls/dollar puts, ranging from one-month to one-year, with strikes above USD1.03. Despite the move lower in spot, 25-delta risk reversals still continue to edge in favor of euro calls, at 1.25 vol up from 1.1 vol.

The International Swaps and Derivatives Association last week released to members the second draft of the 2002 ISDA credit derivatives definitions. It incorporates four new provisions, including the completely new concept of qualifying guarantees. Industry lawyers said the second draft broadens the scope of the definitions and clarifies the first draft.

The International Swaps and Derivatives Association last week released to members the second draft of the 2002 ISDA credit derivatives definitions. It incorporates four new provisions, including the completely new concept of qualifying guarantees. Industry lawyers said the second draft broadens the scope of the definitions and clarifies the first draft.

Lehman Brothers has moved Marcel Koebeli, executive director and head of derivatives marketing to Swiss clients, to London from Zurich to become head of equity derivatives sales for Northern Europe, which excludes France, Spain and Italy. Koebeli is not replacing anyone, but simply providing additional focus on marketing equity derivatives to clients in Northern Europe, because of what the firm sees as a growing market, according to a spokeswoman. Riccardo Petrachi, executive director, will assume responsibility for equity derivatives in Switzerland from Koebeli.

Credit Lyonnais recently hired Jeffrey Chu, structurer at BNP Paribas in Hong Kong, in a new role as a director for its Hong Kong desk, handling interest-rate derivatives structuring, according to Frédéric Lainé, Asian head of fixed income and derivatives in Hong Kong. "This will allow us to better serve corporate end investors," said Lainé, declining further comment. Chu, who now reports to Lainé, also declined comment.

Morgan Stanley has hired Tsang Chi Foon, structurer in the global relative value group at Deutsche Bank in Hong Kong, in a similar role in Hong Kong, according to market officials. "He's one of the best structurers out there," said one market official familiar with the move, noting that Tsang had been with Deutsche Bank for over five years and focused on foreign exchange structuring.

Hermann Watzinger, managing director and head of debt markets securitization and portfolio credit derivatives at Merrill Lynch in London, has been let go, according to an insider. This move comes just two weeks after a reorganization orchestrated by Harry Lengsfield, head of debt markets for Europe, Middle East and Africa, in which Glenn Barnes, head of European structured credit, was pushed out (DW, 7/8). Watzinger reported to Dale Lattanzio, managing director and European head of global principal investing and structured finance. Lattanzio declined to comment. Watzinger could not be reached.

"The basic objective is to promote the development of the derivatives market and create standardized local market practices."--K.K. Yoo, deputy general manger of Kookmin Bank in Seoul, explaining the motivation behind setting up the Korean Swap Dealers Association. For complete story, click here.

Hong Kong Exchanges and Clearing recently announced changes to the stock exchanges listing rules. The principal changes include the broadening of the rules to cover structured products, which include derivative warrants and equity linked instruments (ELIs) and the streamlining of the rules applicable to such structured products. The new rules became effective on July 1.

Schroder Salomon Smith Barney has hired Alaister Moull, associate director and credit-default swaps trader at UBS Warburg, as v.p. in a similar role. Moull will start in mid-August and report to Iftikhar Ali, head of credit-default swaps trading at Salomon. Ali said the hire is part of Salomon's efforts to strengthen its single-name trading desk. The firm had been looking for one to two credit traders to meet demand for increasing deal flow (DW, 12/24). Ali said he would hire opportunistically--if he saw a qualified person--but has no immediate plans. Moull declined comment.