Friday, May 7, 2010

News 100507: Clever Pirates, UK fingerpointing, NYPC DTCC NYSE.EN JV, CCP Panacea

Somali Pirates Say They Are Subsidiary of Goldman Sachs

*** Well worth a read. (as is the Hollywood market story).

So, after some healthy Euroclear bashing by LSE, the tables turn. I’ve requested the Oxera report. I expect it to be the usual cherry picking order size affair. Never-the-less, the great thing is we have some transparency. Is this transparency because of the C&S Code of Conduct?...or because the introduction of competition shines a light into previously dark corners. The measure of including the ‘cost recovery’ settlement fee as a clearing fee is curious, regardless, the incumbent structures remain more expensive at every layer of the transaction value chain.

The DTCC should advocate transparency. Why would you not break out data from the Trade Warehouse?

The benefits of portfolio clearing…get a plug from NYPC (New York…Portfolio Clearing – no less!).


15% to 30% discounts sound great, but as ever, it depends on the context (think correlation of product and tenure). Again, I fear Oxera style cherry picking of position or trading pattern scenarios.

There are not enough articles about CCPs not being the 'be all and end all' cure of all evils. A CCP manages risk, it doesn’t obliterate it, remove it or delete it. It might mitigate it with netting and manage it with margin…but at the end of the day…it’s only as good as the counterparties at the table.

I will be in HK Wed / Thu of next week. If you would like to catch up, please let me know.

We’re into the running season here. Wonderful. I ran on Tuesday and limped around for the next 2 days.

Why does it look so easy on TV?

And my good old Reds…

…The Reds looked to be on track to win the match in the first half and led 13-21 at the break but the Hurricanes took a step up after half time and scored 31 unanswered points to secure the victory and the bonus point….

…ahhh well, it was great while it lasted.

Have a great w/end all.

My son & I will be cycling (and maybe a spot orienteering)…ohhh…and it’s Mothers Day down under too.

So where-ever you are…give ya mum a buzz to say g’day.



Someone's sitting in the shade today because someone planted a tree a long time ago."

--Warren Buffett,
American businessman and philanthropist,
quoted for Arbor Day, April 30, 2010


30/04/2010 15:12:00


European electronic exchange venue Equiduct has moved to take advantage of Nasdaq OMX's decision to shut its Neuro MTF, entering into exclusive talks to migrate clients to its platform.

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Highlights of ITG's March Liquidity Barometer For Asia

ITG just released their "Liquidity Barometer" of Asia for March. Here are the highlights. Japan, the largest developed exchange by market capitalization (Shanghai Stock Exchange is the biggest) continued to benefit from the... Read More Here


Sale of Chicago Climate Exchange to ICE Reinforces Weak Carbon Market
By JOEL KIRKLAND of ClimateWire
Richard Sandor spent the past decade peddling a big idea: that capitalism has a solution for global warming. The trading house he launched in 2003, the Chicago Climate Exchange, would be the locomotive pulling an American environmental revolution into the 21st century as smokestack industries bought and sold a commodity called greenhouse gas emission allowances. Carbon futures and options, so his theory went, would turn financial speculators into tree-huggers.

ELX Futures Sets Record Average Daily Volume In April
ELX Futures, L.P. (ELX) announced today that record average daily volume (ADV) was set in the month of April at 61K contracts, the highest in the nine full months since launch. It also set a daily volume record on April 27 with 95K contracts traded for the combined five U.S. Treasury futures products as well as trading 70K contracts for six days in April. ELX also announced in April that it will launch its Eurodollar Futures contract on Friday, June 18, 2010

Global dairy futures market on the way
By Owen Hembry
An NZX global dairy futures market aimed at helping companies tackle volatile prices is expected to be launched in the middle of this year.

Will Hollywood Go the Way of Enron? Derivatives Come to the Movies
As if attacks from paparazzi and star-crazed fans weren't enough, Hollywood stars may soon have a literal price put on their heads by investors in the Cantor Exchange, a real-money trading platform where people can bet on the gross profits of upcoming movies. Sales of The Dark Knight skyrocketed after Heath Ledger died unexpectedly, and so did sales after the deaths of Michael Jackson, Elvis Presley and Marilyn Monroe. Will greed-driven investors now be laying in wait for the stars of movies they have bet on?

*** "The only difference between the new box office futures contracts being manipulated and blowing up," he says, "and stocks in companies like Lehman Brothers being manipulated and blowing up, is that people losing their money can imagine getting screwed by Scarlett Johansson instead of Dick Fuld."

*** an altogether more attractive proposition from my point of view.

Temasek to buy 5 pct stake in India's NSE stockmarket
* Temasek bought stake from NYSE Euronext-financial source
* NYSE Euronext to sell stake for over $150 mln-report
* Second investment in India in less than a month (Adds detail on deal)
By Saeed Azhar
SINGAPORE, May 3 (Reuters) - Singapore state investor Temasek will buy a 5 percent stake in the National Stock Exchange of India (NSE) from NYSE Euronext (NYX.N) (NYX.PA), its second investment in an Indian firm in less than a month.

Have Dark Pools Lost Their Innovative Touch?
Woodbine Associates’ Matt Samelson says that while dark pools have evolved to meet changing industry needs they may have become the very thing they sought to change.;jsessionid=ZKBS2EMIBK4I3QE1GHPSKH4ATMY32JVN?articleID=224700806&_requestid=153433


Euroclear: Study Proves LSE’s Loss of Market Share is Due to High Trading Costs

Euroclear UK & Ireland on Tuesday said that the results of a study it commissioned on the costs of executing trades on the LSE and two of the largest alternative trading systems in London prove that post-trade processing fees aren’t to blame for why the London exchange is losing market share.

Euroclear Welcomes Karim Ben Rais To Its Single Platform Management Team
Euroclear announces today that Karim Ben Rais will join Euroclear as Managing Director and head of Euroclear's Single Platform Modules division, one of four IT Project Delivery divisions within the Euroclear group. Effective 5 May, he will also become a member of the Euroclear Group Management Team

Oslo Clearing Defers The Launch Of A Central Counterparty For Equities
We refer to earlier announcements on the establishment of a central counterparty (CCP) for equities, equity certificates and ETFs. Oslo Clearing and Oslo Børs have decided to defer the launch date from 12 May to 4 June 2010

SEBI Issues Circular Margining of Institutional Trades in the Cash Market

Please refer to our circular No. MRD/DoP/SE/Cir-07/2005 dated February 23, 2005 and circular No. MRD/DoP/SE/Cir-10/2008 dated April 17, 2008 on 'Comprehensive Risk Management Framework for the cash market' and... Read More Here


*** If you can’t measure it, you can’t manage it. It should be all about transparency.

Futures Clearinghouse Could Slice Collateral Requirements

A new proposed and much-touted clearinghouse for U.S. futures contracts could reduce the value of collateral firms must put up to clear their trades by 15 percent to 30 percent.

Commentary: Clearinghouses are not a panacea
Mark J. Roe, a professor at Harvard Law School, notes that consensus is building that a repeat of the financial crisis might be avoided if derivatives are routed through a centralized clearinghouse. Roe explains that while clearinghouses can boost transparency and provide trading efficiency, they are not a "cure-all." He warns that they could actually exacerbate a financial crisis. The Wall Street Journal (5/6)


HENRY TAX REVIEW: It's politics, not reform

Alan KohlerThe government has adopted less than two full recommendations from the Henry review's list of 138, and added policies not found in the review. 2 May 2010 4:38 PM read more

07/05/2010 10:44:00


US regulators are scrambling to deal with the aftermath of a wild day of 'fat-fingered' trading which saw the Dow Jones Industrial Average lose more than 600 points in seven minutes before the close of trading in New York.

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UBS exec quits to join Nomura: sources

(FINANCIAL SERVICES) Mark Williams to head Nomura's Asia Pacific equity capital mkt. 6 May 2010 10:06 PMread more

Scott Riley

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