New X-Clear rates.
I had a look at the new LCH rates here:
http://clearingandsettlement.blogspot.com/2010/09/news-100903-education-lch-clearing-fees.html
I’ve simply applied the same model to the X-clear rates below.
I’ll let people do their own FX assumptions.
So, to clear 3.3myn trades in a 21 day month:
Total cost x-clear = 85.725K (euro – their FX rate)
Total cost LCH = 78,225 Sterling (you do the FX)
Total cost EMCF = 75K Euros (base ccy)
On the platforms….
More snippets on Chi-X
Despite the Deutsche Bourse connections of Pave I’m surprised by their choice of technology partner.
New Turquoise fee schedule (as yet not on their web site)
On clearing….
I find CFTC talk of limiting the user ownership and governance model of commoditised infrastructure (mutuals) perplexing, annoying and distressing all at once.
On policy….
If the UK banking commission wants to focus on stability, why not take a holiday in Aust?
We have 4 banks here, the so called 4 pillars.
It’s a lovely, excellently functioning oligopoly.
No material competition, no innovation, no chasing of margins….no worries mate!
Of course they are universally hated by customers…and consumers are ripped off.
I spoke to one student, who was not using her credit card because it would cost A$18 just to order a new PIN.
That’s stability.
(fortunately Miss R does not have a credit card…unfortunately to date she appears to remember PIN numbers).
Nigh on impossible to keep up with all the changes taking place.
I’ve not been keeping an eye on the OTC space.
Does anyone have a link or a list of all the various OTC execution facilities for the IRS / CDS space?
Likewise, is there a definitive list of which CCP initiatives are clearing what?
Oh…only the Brits could come up with the gems of bill payments tips…like use the right sort code….inspiring!
Congratulations to Germany on paying off WW1. Paris in 1919…what a different world that was.
I know everyone, knows someone that hates the Welsh…personally, I never understood why…anyway, for the Welsh ‘lovers’
http://www.slapapollie.com/game/1/Gillard
(BTW, I always knew Charlotte C and Gavin H were doomed, shame, but just oh so predictable)
It is a Labor Day public holiday on Monday in NSW, ACT and South Australia.
Day Light Savings kicks in this weekend - don’t forget to advance your clocks forward one hour this Sunday morning at 2am AEST.
Hong Kong and China markets are closed today for the National Day Holiday.
In the final analysis it is not what you do for your children but what you have taught them to do for themselves that will make them successful human beings."
--From the "Ask Ann Landers" American advice column
Have a great w/end all.
Warm regards (hee hee)
S
http://clearingandsettlement.blogspot.com/
PLATFORMS
TRADEWEB LAUNCHES EQUITY DERIVATIVES MARKET
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35757
LIQUIDNET AND INSTINET INK GLOBAL LIQUIDITY SOURCING AGREEMENT
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35766
BATS identified as would-be bidder for Chi-X Europe
http://www.thetradenews.com/trading-venues/exchanges/5113
BLOOMBERG: Australian Markets Regulator to Publish Timetable for Rival Exchanges
By Shani Raja and Chan Tien Hin
09/28/10
Instinet seeking new investors for Chi-X Global
http://thetradenews.com/asset-classes/equities/5126
BLOOMBERG: Chi-X Japan to Triple Number of Stocks to 800 by October, CEO Meyer Says
By Akiko Ikeda and Kotaro Tsunetomi
09/26/10
http://www.bloomberg.com/news/2010-09-27/chi-x-japan-to-triple-number-of-stocks-to-800-by-october-ceo-meyer-says.html
MARKETS MEDIA: Exchanges Look To Future(s)
By Staff
09/27/10
“If quoting is going on repeatedly that's far away from the inside, then where everyone is simply to information, then imposing a speed limit will cause higher internalization rates,” said Isaacson.
Circuit breakers in their current form are a good first step to address situations where there are gaps in linkages between exchanges, but a more sophisticated and potentially more effective step would be to employ limit up/limit down, in which trading continues but executions may only occur within an acceptable preset range or limit.
Noted Mecane, “We have to make sure that linkages don't break down, whether it's through circuit breaker or limit up/limit down.”
Limit up/limit down would prevent clearly erroneous trades, such as fat-finger trades, form triggering circuit breakers and causing a halt in trading.
“We at BATS have been pushing for limit up/limit down,” said Isaacson. “It's worked well in futures markets for years in getting rid of clearly erroneous trades.”
WATERS TECHNOLOGY: US Exchanges Prepare to Shuffle Trading Models
By Michael Shashoua
09/24/10
US equity trading models will see big changes in the coming weeks as NYSE Euronext won approval from the US Securities and Exchange Commission (SEC) on Sept. 24 to launch block rebates for larger order sizes starting on Oct. 1. Meanwhile, Nasdaq OMX is gearing up to roll out a new price–size model platform.
The price–size model can also allow participants to add just one more share to an order to get to the top of a queue, adds Conklin. The contrasting price–time model "really incents people to get in there and fight to tighten the markets at the end of the day," he says.
DUTCH CARIBBEAN SECURITIES EXCHANGE TAPS TRAYPORT FOR TRADING SYSTEM
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35786
*** I thought the only Dutch left in the Caribbean were on holiday.
SECURITIES TECHNOLOGY MONITOR: Merrill Lynch Connects to Asian Off-Exchange Venue
By Tom Steinert-Threlkeld
09/28/10
Tora also aggregates liquidity from multiple venues in Asia.
These venues include Credit Suisse’s Crossfinder, Instinet’s CBX Asia, Japannext, Kabu.com and now BofAML’s MLXN.
Tora Crosspoint will add Hong Kong, Singapore and Australian stocks later this year.
PHILIPPINE STOCK EXCHANGE MIGRATES TO NYSE TECHNOLOGIES PLATFORM
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35816
Spain’s First MTF Picks Equiduct For Technology
By Chris Kentouris
Spain’s first local multilateral trading facility has tapped Equiduct Systems to provide its technology infrastructure.
The Plataforma Alternativa de Valores Expanoles (PAVE) on Thursday said that Equiduct Systems will provide its trading platform and operational infrastructure.
Equiduct Systems is a technology service provider controlled by Citadel Securities, Knight and Borse Berlin. The pan-European segment of Borse Berlin, also called Equiduct, is one of several trading platforms in Europe trying to capitalize on the European Markets in Financial Instruments Directive which allows for alternative venues to compete with incumbent exchanges.
Turquoise announces pricing promotion
The promotion, which takes effect on November 1, will pay its members a passive rebate of 0.4bps, double that offered by competing MTFs.
As part of the new tariff schedule published today, Turquoise also announced it is adjusting its standard passive rebate to 0.2bps and its aggressive fee to 0.3 bps, in line with other MTF venues.
http://www.automatedtrader.net/news/mtf-news/57335/turquoise-announces-pricing-promotion
Funny thing is, this is not even reported on Turquoises own web site.
http://www.tradeturquoise.com/tq_press.shtml
Newedge Executes and Clears $2 billion in IRS via Eris Exchange
Contends private initiatives such as Eris Exchange can create a safer environment for OTC interest-rate ...
Five local trading firms have launched Eris Exchange: DRW Holdings LLC, Getco LLC, Infinium Capital Management LLC, Chicago Trading Co. and Nico Holdings LLC, which have all invested in the entity.
CLEARING
FINANCIAL TIMES: LCH.Clearnet Faces Derivatives Battle
By Jeremy Grant
09/27/10
an application by the London-based clearer to be able to offer OTC equity derivatives linked to Stoxx indices has been rejected by Stoxx
Stoxx is controlled by Deutsche Börse and SIX Group, operator of the Swiss exchange. A separate application by the LSE to be allowed to offer trading in equity derivatives on the Eurostoxx index – one of Stoxx’s products – was also rejected.
SIX x-clear Ltd, announced that it will significantly reduce its prices and introduce a new, simpler, volume-based tariff structure on 1 January 2011.
Volume band (sides per month) Approximate cost per side (in EUR cents)
Up to 50,000 15
50,000 to 250,000 7.5
250,000 to 1,000,000 3.33
1,000,000 to 3,000,000 1.8
Excess over 3,000,000 0.75
http://www.ccp.sisclear.com/ccp/index.htm
So, for 3.3 million trades (see LCH pricing http://clearingandsettlement.blogspot.com/2010/09/news-100903-education-lch-clearing-fees.html)
0-50K = 7.5K
50-250K = 15K
250-1myn = 24.975K
1myn-3myn = 36K
3myn-3.3myn = 2.25K
Total cost x-clear = 85.725K (euro – their FX rate)
Total cost LCH = 78,225 Sterling (you do the FX)
Total cost EMCF = 75K Euros (base ccy)
What is a Swap Execution Facility?
http://streetwiseprofessor.com/?p=3964
EUROCLEAR SET FOR MANAGEMENT REORGANISATION
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35771
Singapore Exchange Bolsters Securities Borrowing and Lending Service
Singapore Exchange (SGX) said September 23 it is enhancing its Securities Borrowing and Lending (SBL) service to bring additional benefits for investors and SGX central depository account...(more)
Singapore Exchange First in Asia to Clear OTC Traded Financial Derivatives
Singapore Exchange (SGX) today announced an expansion of its AsiaClear business with the launch of a new clearing service for over-the-counter (OTC) traded financial derivatives. First in... (more)
CFTC considers limiting ownership of clearinghouses and exchanges
The Commodity Futures Trading Commission is poised to present proposed rules for the over-the-counter derivatives market Friday. The regulator is considering restricting ownership of clearinghouses, trading systems and exchanges to no more than 20% for investors and banks, sources said. The move would affect LCH.Clearnet, Tradeweb Markets, NYSE Euronext and other companies. Bloomberg (9/29)
Goldman CEO warns of risks from using clearinghouses
Lloyd Blankfein, chairman and CEO at Goldman Sachs, told participants at an industry conference in Brussels that in an "extreme" crisis, the use of clearinghouses could exacerbate risks. "I agree that clearinghouses make things less risky for the regular crisis, but in an extreme crisis, that could affect the clearinghouse itself," and that would be "dramatically more risky," Blankfein said. "We have to make sure that something that we do to reduce the risk in a once-in-a-20-year storm doesn't increase the risk in a once-in-a-50-year storm." Bloomberg (9/29)
POLICY
UK to probe high-frequency trading
(FINANCIAL MARKETS) US regulators finalise flash crash report. 1 Oct 2010 6:50 AM read more
UK banking commission focuses on stability and competitiveness
The UK's Independent Commission on Banking released a paper outlining its goals, which include finding ways to ensure the stability and competitiveness of Britain's financial-services sector. The panel said it will consider the idea of breaking up large banks, subjecting larger financial institutions to higher capital requirements and taxes, and requiring some to sell assets. The government commission has asked the industry for feedback on the issues. The Wall Street Journal/Dow Jones Newswires (24 Sep.) , The Independent (London) (26 Sep.)
BRITS TOLD TO USE PAYMENT REFERENCE WHEN PAYING BILLS ONLINE OR OVER THE PHONE
http://www.finextra.com/news/announcement.aspx?pressreleaseid=35857
The 5 tips of consumer advice:
1. Use the right sort code and account number when paying a bill
2. Always include the beneficiary (how do you make a payment without a beneficiary?)
3. Insert the correct company billing name
4. Double-check everything before you hit 'go.'
5. If you get stuck when making an electronic payment online or by phone, consult the help pages on your bank's site or contact your bank
Celent advocates regulation for broker crossing networks
Market consultancy Celent has published a report that calls for regulation of investment banks' in-house trading venues. Celent argued that the broker crossing networks offer the "same services as the regulated venues without the commensurate regulatory burden". The report comes as European regulators review the Markets in Financial Instruments Directive, which governs trading in the region. Financial News Online (U.K.) (subscription required) (29 Sep.)
PARTICIPANTS
Morgan Stanley leads capital-market rankings for EMEA
Morgan Stanley has climbed up the capital-market rankings for Europe, the Middle East and Africa to become the top book runner this year. The bank has a market share of 8.8% in the regions' equity-capital markets, up from 7.9% for all of last year. JPMorgan Chase dominated the rankings last year. Financial News Online (U.K.) (subscription required) (27 Sep.)
*** Bravo chaps! Backslaps all round.
White House slashes US bailout cost estimate
(ECONOMY) Sees TARP cost falling to less than $US50bn. 1 Oct 2010 8:41 AM read more
In addition to the AIG move, the Treasury said it had earned a profit of $US2.25 billion on the sale of Citigroup Inc securities it received in exchange for a $US5 billion guarantee on a portfolio of potentially toxic assets. The guarantee was cancelled with no losses.
The Treasury also said it has now sold off $US16.4 billion worth of Citigroup stock, reducing its stake in the banking giant to 12.4 per cent – a third of its size at the peak of the bailout.
STUFF
The world is a tragedy to those who feel, but a comedy to those who think."
--Horace Walpole,
British art historian and politician
Germany Closes Book on World War I With Final Reparations Payment
Germany will make its last reparations payment for World War I on Oct. 3, settling its outstanding debt from the 1919 Versailles Treaty and quietly closing the final chapter of the conflict that shaped the 20th century.
http://www.spiegel.de/international/germany/0,1518,720156,00.html#ref=nlint
http://www.chocolatecarnival.co.nz/cadbury_jaffa_race
*** What’s a Jaffa?...here’s 25,000 of them!
MUGS FOR THUGS
Munich Oktoberfest Sees Rise in Assaults with Beer Glasses
While certain crimes are down at Oktoberfest this year, there have been more attacks with an unlikely, yet readily available, weapon: the one-liter beer stein. Some of the victims have been whisked away in ambulances with concussions and fractured skulls caused by fights involving the heavy glasses.
*** "A hard hit with a stein packs more than 8,500 newtons of power -- the human head in the parietal region breaks with about 4,000 newtons."
Just push your cursor from the hand to 'her' face but the faster you hit her with "the hand" the further the distance and your marks.
http://www.slapapollie.com/game/1/Gillard
Daily chart: Fat of the lands
The bulging problem of obesity
http://news.economist.com/cgi-bin1/DM/y/eCPCr0dHglU0Mo0Gqlv0Ej
MARK-2-MARKET: Death duty resurrection
(ECONOMY) An inheritance tax deserves a rational discussion at the tax summit as it's simply unfair that ‘Australia’s luckiest sperm club' lives tax free, while the rest of us pay up to 50 cents in the dollar. 1 Oct 2010 6:28 AM read more
Scott Riley
Business Development
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