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The clearing industry could face increased systemic risk thanks to incoming Basel III regulations on capital charges if more clearing providers, or futures commission merchants as they are known in the US, are forced to close.

TriOptima has eliminated $500bn in notional principal outstanding since the launch of its cross-currency compression swap service earlier this year, and client participation has nearly doubled from 12 to 20 institutions.

Hedge funds are targeting decompression between iTraxx Crossover and iTraxx Main, in the expectation that Main will tighten versus Crossover in the aftermath of rumours that the European Central Bank may extend its asset buying programme to include corporate bonds. Funds are specifically looking at going long risk iTraxx Main and short risk iTraxx Crossover.

UBS has seen its exchange traded note program assets more than double in just over a year. The program had approximately $2bn at the end of July 2013 and now has around $4.5bn.

The fate of the eurozone’s ailing economy, and the policies undertaken to tackle the malaise, should have the biggest influence on spread direction in the coming months. But in the near term, Europe’s banking sector will be under scrutiny with the announcement of the ECB’s Asset Quality Review and the EBA’s stress test results on October 26.

Market participants, particularly institutional investors, have been picking up risk-reversals and put options on sterling against the dollar.

Futures commission merchants (FCMs) are expected to come under increasing pressure from the buyside to reduce the clearing fees that they charge as trading volumes increase. This comes following an increase in rates charged by some FCMs in a bid to cover the rising costs of business associated with the implementation of various regulatory changes.

The Singapore Exchange has reported a 4% increase in derivatives revenues year-on-year in its first quarter results for the 2015 fiscal year. Derivatives volumes at the exchange were up 9% to 28.8 mn contracts.

Overall credit default swap notional that was reported to swap data repositories last week decreased by 4% from the previous week, according to data from the International Swaps and Derivatives Association. This follows six weeks of a consistent uptick in CDS notional, with a combined increase of 160%.

Live order book trading of market agreed coupon swaps is now trading on UBS’ electronic trading platform Neo, making it the first platform to offer an aggregated order book for MAC swaps.

Dealers are facing increasing costs when providing clearing services to pension funds amid the regulatory push to move trades to clearing houses. The lack of netting provisions for pension funds means capital charges for dealers are high, with the result that leading banks are questioning the viability of the business without a rise in clearing prices.

Institutional investors have been buying VIX call options with October expiries to express a bullish and long volatility view, following a slew of VIX calls that were sold when the market was down Tuesday.