Time to get comfortable with SEFs

The CFTC’s 29th meeting on Dodd-Frank rules, held in Washington, D.C. on May 16th, has been widely covered in the financial press. Final SEF (Swap Execution Facility) rules – including the so-called “Made Available to Trade” (MAT) rule – and minimum block sizes for swaps... Read More

Buy-side steps up

With financial markets focused firmly on risk reduction – a key priority for the G20 – the buy-side is turning its attention to the issue of counterparty risk. This parallels well with the OTC clearing requirements set out in the Dodd-Frank Act. In a reaction to the perceived risk inherent... Read More

Swap your workflow

We’ve discussed the current course of regulatory change, specifically Dodd-Frank here in the States, and alluded to the “total set of changes the derivatives industry is going to go through”. But one thing is clear, the interrelationships between buy-sides, sell-sides (FCMs and swaps... Read More

The long arm of the law

The buy-side has traditionally been spared from the burden of most regulatory trade reporting requirements, passing this responsibility on to their brokers who hold the exchange memberships. But this principle looks to have been challenged by BaFin, the German financial regulator, with the introduction... Read More

Keeping to the letter of the law

Earlier this week BaFin, the German regulator, held a workshop on the German HFT Act. Global market participants gathered in Frankfurt to discuss and better understand the implications of the soon to be passed law. Questions around the definition of HFT, registration as an HFT firm when operating from... Read More

One firm, two guv’nors

Making a living as a market maker is no easy task these days, with low trading volumes and the increasing regulatory burden tending to wipe the smile from many a trader’s face. Market making certainly has some perks, though, with exemptions from the European Short Selling Regulation, UK stamp duty... Read More

Stop/start for Dodd-Frank’s swaps rules

The Dodd-Frank Act, nearly three years old this summer, continues its slow, inexorable pace of implementation. In some respects, the financial landscape has changed unequivocally; in others, the final results of change remain to be seen, as the industry awaits additional rulemaking. Most of the current... Read More

Just when I thought we were out, they pull us back in

Since 2007 many of us in the industry have been attempting to iron out the inconsistencies (and confusion) introduced by MiFID around the use of venue of execution (VoE), Market Identifier Code (MIC) and Last Market (FIX Tag 30). In May 2012 FPL’s Buy-Side Working Group published its best practices... Read More

Extraterritoriality agreement – maybe today, maybe tomorrow…

Extraterritoriality agreements for cross-border OTC derivatives have been hotly debated for a while now, but there have been few visible signs of progress in recent months. Last week the Chairman of the US SEC, Elisse Walter, presented her views on the complex area of equivalence and reciprocity. In... Read More

Take a break

Financial markets are global and closely interconnected. While this is largely beneficial for all market participants, it can also create spillover effects with unintended consequences. An academic study argues that liquidity can affect related instruments and create a feedback loop, or, put more pessimistically,... Read More

If it moves, tax it!

The proposal for a Directive implementing enhanced co-operation in the area of financial transaction tax (aka the EU FTT), with its eye-wateringly broad scope, will have to be churned through the legislation mills PDQ if it’s to meet its overly ambitious timeline. The would-be tax applies to all... Read More

A cry for help

More and more industry representatives are complaining about the politicisation of the rule-making process in financial markets. In Europe, politicisation has triggered some absurd episodes, such as the proposal for the greatest uncontrolled financial market microstructure experiment in the world (aka... Read More