July 25, 2017 | "Irreverent, but never irrelevant" | | | John Lothian Publisher John Lothian News | |
|
| | First Read | |
| 2017 Newsletter Subscriptions: | |
Hits & Takes We've heard the education, education, education mantra for many years now. Today's JLN brings you some of the firms living up to that refrain - Magnetar, Divento, John Lothian News and Boy Scouts. How we teach the next generation of youngsters will define our industry in the coming years. ~JK One of the many cool things about JLN's MarketsWiki Education World of Opportunity summer education series is you never know exactly what any given person is going to talk about. Sometimes, the talks are so widely relevant and informative, it doesn't matter if the audience is interns or not. Michael Kraines, Trading Technologies' CFO, gave a talk like that at our Friday event regarding the state of Chicago fintech and its key players. Long story short - the city is looking pretty good. In 2016, venture capitalists shelled out almost $1 billion in 90 deals. In the first half of 2017, that number is $952 million in 55 deals. ~SD While John Lothian is away at summer camp in Wisconsin with his son Robby and the Boy Scout troop, he is doing some blogging. He created a blog post on Asian Pacific News from John Lothian News for July 24, 2017.~JJL Canadian ETFs are on a hot streak  in both May and June the instruments attracted more than $3b of inflows. Their added popularity is reflected by the Toronto Stock Exchange hitting 500 ETFs listed on July 5. Montreal Exchange (MX) lists options on 58 Canadian ETFs. ADV in ETF options from 2009 to 2014 was stuck in the 10k - 20k contracts range. Thus far in 2017, MX ETF options ADV is more than 40k contracts. See this PDF for more on Canadian ETFs. ~SD ++++ What Education Does: How The Financial Industry Can Shape Young Minds And Our Industry's Future Jim Kharouf - JLN Coming off two weeks of MarketsWiki Education sessions, it's time to stop and look at education. It's hard to believe, but most schools - and let's stick with high schools in the Chicago area - do not have a financial education program built into their curriculum. What a shame. We demand that kids study, build a foundation to master a subject, and excel in their careers, but almost never teach them how to manage the money they earn. Chicago Public Schools is aiming to change that beginning this fall, with a new requirement that all of its students take a financial literacy "unit" to graduate. Exactly what that entails is still being decided, but it appears to be opening a door for the Magnetar Capital UChicago Financial Education Initiative, launched for just that purpose a year ago. The roots of the program go back to 2012 when Magnetar Capital created Magnetar Academy to design, build and implement a financial education course for students at Chicago-area high schools. Magnetar pays teachers to take the online course and provides them with the curriculum information for the students. To date, the program has been adopted and implemented by more than 150 teachers at 93 Chicago-area schools. The course has been delivered to more than 10,000 high schoolers. Magnetar believes its program can be expanded dramatically primarily throughout the Chicago high school system, although each CPS high school has discretion on what program it will actually teach. Read the rest of the article HERE ++++
How the Cloud is Disrupting Post-Trade JohnLothianNews.com Sernova Financial, a cloud-based post trade utility, is just starting its second year and Calypso Technologies has just taken a minority stake in the company. Sernova and Calypso already had a partnership offering cloud-based clearing services. The founders of Sernova came from the clearing divisions of top tier banks, where they found the business wasn't necessarily cost efficient or revenue-generating. So they decided to take post trade services out of the bank and put it in the cloud as a utility. Read the rest and watch the video » ++++ An emerging manager's game plan CTAExpo - Bucky Isaacson and Frank Pusateri This document is a roadmap for any manager starting out or needing to understand the art of marketing yourself, your business, your intellectual property. jlne.ws/2tEACHV **JK: You never know what you're gonna get in this section. Here's a nice guide for emerging managers. Also put CTA Expo on your calendar for September 14 in Chicago ++++ John Shay is out at NASDAQ after only 10 months. Trading Places by Jim Greco In a client letter obtained by Trading Places, NASDAQ communicated to its U.S. Treasury clients this morning that "John Shay, Head of FICC, has decided to leave the organization". Tom Wittman, NASDAQ's Global Head of Equities, will now lead all of trading, including the NASDAQ Fixed Income business line. /goo.gl/gPvz5o **JK: Let's just say he was there for 295 days. ++++ COMBUS to provide Australian catastrophe models on the Boat Oasis platform. cision.com Catastrophe risk loss models have developed significantly over the past 25 years within the global (re)insurance industry, providing essential tools to help (re)insurers prepare for the financial impact of catastrophes. Little has changed in the model marketplace during this time, however, the introduction of open source modelling will lead to greater access to models for different perils in different regions from more vendors than ever before. jlne.ws/2eKJV27 **JK: This is a disaster waiting to happen. **Second comment: From a branding perspective, should BOAT OASIS really be doing business with COMBUS's Australian Bushfire, Severe Convective Storm, Low Pressure System, Tropical Cyclone and Earthquake models? ++++ Dash Financial Technologies Appoints Sarah Hall Managing Director, Head of Human Resources Press Release Dash Financial Technologies today announced it has named Sarah Hall Managing Director, Head of Human Resources. In this role she is responsible for all aspects of the firm's human capital investment, employee relations and talent management programs globally. /goo.gl/ya1xgm **JK: So, where do you plan on being in the next five years, Sarah? ++++ Monday's Top Three Monday's top stories were led by Bloomberg's piece Commodities Are Good for Traders, Bad for Investors. Second was the curiosity piece from KSTP, Wisconsin Company to Implant Microchips in Employees. Third went to FinanceFeeds' piece on Trading Technologies appeals another Patent Board decision involving Interactive Brokers, TradeStation, IBFX ++++ MarketsWiki Stats 104,999,547 pages viewed; 22,618 pages; 207,172 edits MarketsWiki Statistics ++++
Sponsored Content | Upcoming Fed Meeting: When and What to Watch Prepare for the next round of central bank meetings and learn how you can manage your exposure through ICE's deeply liquid interest rate product portfolio. Sponsored content from: |
++++
|
| | | | |
Lead Stories | LedgerX gets U.S. approval for derivatives on digital currencies Gertrude Chavez-Dreyfuss - Reuters The U.S. Commodity Futures Commission said on Monday it has granted New York-based LedgerX, a bitcoin options exchange, the first license to clear and settle derivative contracts for digital currencies. jlne.ws/2vTHy0k Nasdaq to Acquire UK Market Surveillance Startup Reuters Nasdaq Inc has agreed to acquire Sybenetix, a London-based startup that uses artificial intelligence to help compliance officers at asset management firms analyze the behavior of their traders in order to prevent market abuse. Sybenetix will enable the exchange group to expand its current market surveillance technology offering to service buy-side firms, Nasdaq said on Tuesday. It did not disclose the amount it intends to pay, but said the purchase price would be funded with cash on hand. /goo.gl/8MNmT3 Wall Street's Grip on Bond Trading Means a 1% Gain Takes 3 Years Bloomberg Getting Wall Street banks to hang up the phone and embrace electronic trading in corporate bonds has never been easy, but there's evidence the old guard is finally learning some new tricks. /goo.gl/vCe4x9 Deutsche Bank Weighs Moving $350 Billion From U.K. to Frankfurt William Canny and Steven Arons - Bloomberg 'Project Bowline' details steps for moving trades from London; Balance sheet move scheduled to be completed by March 2019 Deutsche Bank AG may shift about 300 billion euros ($350 billion) from the balance sheet of its U.K. entity to Frankfurt as client trading and assets migrate to the continent following Britain's decision to leave the European Union, according to a person familiar with the matter. /goo.gl/N81BpG Some of the largest companies in the world are coming to the defense of the New York Stock Exchange Frank Chaparro and Matt Turner - Business Insider Bats, the stock exchange recently acquired by the Chicago Board Options Exchange, is proposing a new model for trading at the end of the day; The model represents a direct challenge to the New York Stock Exchange and Nasdaq; Some of the largest companies in the US have voiced their opposition to the proposed Bats Market Close, which they say would harm the markets. Some of the largest companies in the US are speaking out against a proposal by Bats, the stock exchange recently acquired by the Chicago Board Options Exchange, to shake up end-of-day trading. /goo.gl/Mfqfjo Investor Makes Mammoth VIX Bet That Could Pay Out $265 Million; Big bet on a powerful resurgence in market turbulence sees 'fear gauge' at 25 by October Gunjan Banerji - WSJ One investor has bet on a powerful resurgence in market turbulenceÂa wager that could net a profit of about $265 million if Wall Street's fear gauge more than doubles in the next three months. /goo.gl/Mc7cjy Morningstar buys stake in responsible investing firm Lynne Marek - Crain's Chicago Business Chicago investment research company Morningstar has purchased a 40 percent stake in Sustainalytics, an Amsterdam-based firm that focuses on responsible investing. /goo.gl/w1QKLL
|
| | | |
|
Exchanges, OTC & Clearing | Top news from exchanges, clearing, settlement and trade execution facilities | Sometimes it's tough being average Fidessa Back in March the CME Group postponed the effective date of amendments to Rule 553 ("Average Price System") until July 2, 2018 to allow sufficient time for affected Exchange Clearing Member Firms and CME Clearing to make the necessary changes to implement the rule. /goo.gl/gDyJY7 CFTC Grants DCO Registration To LedgerX LLC Mondovisione The U.S. Commodity Futures Trading Commission (Commission) announced today that by a unanimous vote of the Commission, it has issued an order granting LedgerX, LLC (LedgerX) registration as a derivatives clearing organization under the Commodity Exchange Act (CEA). Under the order, LedgerX will be authorized to provide clearing services for fully-collateralized digital currency swaps. LedgerX, which was also granted an order of registration as a Swap Execution Facility on July 6, 2017, initially plans to clear bitcoin options. jlne.ws/2vTGIkn Hong Kong exchange blocks Morgan Stanley, Li Ka-shing-backed IPO; Action comes as regulators tighten up on small listings with incomplete information Ben Bland and Jennifer Hughes - FT The Hong Kong stock exchange has blocked an initial public offering by a financial services group backed by Morgan Stanley and Li Ka-shing because the Chinese state-owned brokers sponsoring the IPO filed a "substantially incomplete" prospectus. /goo.gl/GGgE1Q TP ICAP partners with Bloomberg for MiFID II trading venue registration; Bloomberg's platform will allow TP ICAP clients to register on new trading venues ahead of MiFID II. Hayley McDowell - The Trade TP ICAP has deployed Bloomberg Entity Exchange's platform in a bid to help its clients register with new trading venues operated by Tullett Prebon and ICAP under MiFID II. /goo.gl/vt9YCw Moscow Exchange: Eurasian Development Bank Gains Access To MOEX Derivatives Market Mondovisione Eurasian Development Bank is the first ever international financial institution to receive admission to MOEX Derivatives Market as a member firm. jlne.ws/2vTAHE0 Moscow Exchange names new head of investor relations MOEX Anton Terentiev has joined Moscow Exchange as Investor Relations Director. /goo.gl/GnYK8u
|
| | | |
|
Fintech | A roundup of today's market tech news and a look at tomorrow's disruptors | Marusan goes live with Fidessa for wholesale agency trading Finextra Fidessa group announced that Marusan Securities Co., Ltd., an independent securities company headquartered in Tokyo, has gone live with Fidessa for its wholesale agency trading business. jlne.ws/2eKj8Df Bitcoin Options Will Be Available This Fall Camila Russo - Bloomberg LedgerX says it's the first regulated bitcoin options exchange; CFTC authorized company to provide clearing services for swaps LedgerX LLC, a cryptocurrency trading platform operator, won approval from the U.S. Commodity Futures Trading Commission to operate as a federally-regulated exchange and clearing house for derivatives contracts settling in digital currencies. /goo.gl/5VT3NF BlackRock to use machine learning to gauge liquidity risk; Firm close to rolling out new models for redemption risk and market liquidity Faye Kilburn - Risk.net BlackRock is turning to machine learning to better understand liquidity risk. Over the next two months, the asset manager will incorporate internal trade data into its existing market liquidity model, and apply machine-learning techniques to more accurately calculate the cost of liquidating fund positions in the case of redemptions. /goo.gl/aefz1L The biggest financial bloggers reveal their positions on bitcoin and cryptocurrencies Shawn Langlois - MarketWatch Josh Brown, a popular blogger and investment adviser, announced last week that he joined the crypto circus with his first-ever bitcoin purchase. /goo.gl/hBbEPY Hong Kong programme hopes to unearth next fintech blockbuster; Ten technology start-ups selected for a 12-week mentorship programme, backed by 18 major financial heavyweights Bien Perez - South China Morning Post Ten technology start-ups, including companies from Hong Kong, South Korea, Singapore and the United States, aim to introduce innovation that could help financial institutions in the Asia-Pacific improve their efficiency, bolster cybersecurity and offer more customer-friendly services. /goo.gl/oMVw56 Bitcoin recovers after roller coaster ride, exchanges advise caution; A new solution to raise deal speed is expected to avoid hiccups in trading when launched on August 1 Rajesh Bhayani - Business Standard Bitcoin and other crypto or virtual currencies have surged the past week after a sharp fall, as a solution to increase the speed of transactions has been agreed upon by miners. The solution is expected to avoid problems and hiccups in trading when it is implemented on August 1. /goo.gl/5Uu6Ri
|
| | | |
|
Politics | An overview of politics as it relates to the financial markets | Lords seek way for banks to maintain EU access and keep stability after Brexit Catherine Neilan - City AM A Lords committee has launched an inquiry into how the UK's financial services industry can keep its access to the rest of the European Union after Brexit. /goo.gl/yp9Ubk How Donald Trump is monetising his presidency; Six months in, Mr Trump's conflicts of interest look even worse The Economist "Pretty close to a laughing stock." That is Walter Shaub's verdict on America's standing in the world, at least from an ethics point of view, under President Donald Trump. Mr Shaub's view counts: he stepped down this week as head of the Office of Government Ethics, a federal watchdog. /goo.gl/81dWSb Wall Street Braces for Debt-Ceiling Showdown Ben Eisen - WSJ Wall Street is getting worried about the debt-ceiling debate in Washington. /goo.gl/xSPtrD
|
| | | |
|
Regulation & Enforcement | For more regulatory, visit MarketsReformWiki, our website focused on current market reform efforts. | Jailed Schroders Trader's Criminal Lifestyle Costs Him $456,000 Suzi Ring and Helen Chandler-Wilde - Bloomberg Damian Clarke was sentenced to two years in jail last year; Clarke accused of insider dealing over a decade in London A former Schroders Plc equities trader was ordered to pay 350,000 pounds ($456,000) by a London judge after prosecutors said that he lived a "criminal lifestyle" on the proceeds of a decade's worth of insider trades. /goo.gl/XMKv6s JP Morgan and Deutsche agree $148m rate rigging settlement; Investment banks agree to settle claims of yen Libor rigging, although did not admit any wrongdoing. Hayley McDowell - The Trade JP Morgan and Deutsche Bank will pay a combined $148 million to settle allegations of yen Libor and Euroyen Tibor benchmark interest rates manipulation in the US. /goo.gl/9XNcWs SEC Names Bryan Wood as Director of the Office of Legislative and Intergovernmental Affairs SEC The Securities and Exchange Commission today announced that Bryan Wood has been named Director of the agency's Office of Legislative and Intergovernmental Affairs. Mr. Wood will advise the Chairman, Commissioners, and SEC staff on legislative matters, provide technical assistance on securities-related legislation to congressional committees and staff, assist in preparing SEC testimony for congressional hearings, and coordinate with other government entities. /goo.gl/R78D3a FCA consults on anti-money laundering supervision; Banks including HSBC, Standard Chartered and RBS have all been fined heavily for lax controls in recent years Lucy McNulty - Financial News The City regulator has opened a consultation with financial firms over its future approach to anti-money laundering supervision. /goo.gl/dsbmTt FCA Gets £350K Confiscation Order Against Insider Trader Richard Crump - Law360 Former Schroders PLC trader and convicted insider dealer Damian Clarke must pay £350,000 ($456,000) within three months or face three more years in jail, Britain's Financial Conduct Authority said Monday. /goo.gl/RvjSQb IPO shortage keeps US cash in a few wealthy hands Rana Foroohar - Financial Times The US market in public share listings is ailing; over the past two decades, the number of initial offerings has plunged 45 per cent. That is one reason Barack Obama, then president, passed the Jumpstart Our Business Startups Act, which allowed listing companies worth less than $1bn to keep their finances private for longer. jlne.ws/2tElGJA Florida Court extends restraining order against "Millionaire Money Machine" binary options fraudsters Finance Feed The architects of a number of binary options scams, including the "Millionaire Money Machine" fraud, are ordered to appear in court for a hearing rescheduled for August 10, 2017. Last week, the US Commodity Futures Trading Commission (CFTC) posted a brief press release on the case it filed against a number of binary options fraudsters. The regulator was able to publish the release only after key documents in the case, captioned Commodity Futures Trading Commission v. Scharf et al (3:17-cv-00774), were unsealed at the Florida Middle District Court. /goo.gl/aJ9c7E
|
| | | |
|
Investing & Trading | Today's top stories from equities, indices and FICC (fixed income, currencies and commodities) | Mergermarket Group Rebrands as 'Acuris' Press Release Mergermarket Group, the leading provider of business intelligence and research for fixed income, transactions, infrastructure, compliance and equities, today announced that it has re-launched under the brand name Acuris. The Company is globally recognised through its unique portfolio of brands, with 700+ reporters, analysts and developers covering financial markets throughout Europe, Asia and the United States. Acuris has 17 offices globally, including three headquarters in London, New York and Hong Kong. jlne.ws/2utF3E3 Bakers scramble for the aristocrat of wheat Emiko Terazono - Financial Times As a group of bakers, flour millers and agricultural traders descend on the US northern plains of North Dakota and Minnesota this week, they will be trying to gauge the damage wrought on this year's crop of top quality wheat by the region's drought. The lack of rain and above normal temperatures have hit the hard red spring wheat, which is used for bread and pasta. Conditions of the crop, known in the industry as the "aristocrat of wheat", have deteriorated, sending prices soaring to a four-year high. jlne.ws/2tEguFP The Death of Equity Research Hasn't Been Greatly Exaggerated James Valentine - Integrity Research Associates From my vantage point, the career prospects for Equity Research analysts look dismal. The decade-long shift from active to passive management isn't new, but it appears to be reaching a tipping point as seen in the rash of announcements from high-profile buy-side and sell-side firms closing their doors, merging or outsourcing to bots. jlne.ws/2tEji5y Investors withdraw from long-dated Treasurys ETF Sunny Oh and Ryan Vlastelica - MarketWatch Fund had its biggest one-day outflow since 2014 on Friday Investors have pulled hundreds of millions of dollars from the largest exchange-traded fund to track long-dated Treasury bonds, in what some see as investors as efforts to unload those investments after a strong year-to-date run-up. /goo.gl/poC5yj World's Biggest Miner Speeds Hunt for Copper in 'Last Frontier' David Stringer , Laura Millan Lombrana , and Stephan Kueffner - Bloomberg BHP has opened office in Ecuador along with Newcrest, Hancock; Value of nation's mining sector could hit $7.9 billion by 2021 BHP Billiton Ltd., the world's biggest miner, has opened an office and is seeking to add staff in Ecuador as it advances a search for copper in a nation that's becoming the sector's exploration hot-spot. /goo.gl/YUTxpB
|
| | | |
|
Banks, Brokers & Managed Funds | The latest from banks, brokers, hedge funds and managed futures | Barclays prices unbundled research at up to £350k; Pricing plan reveals huge potential costs of buying research under MiFID II. John Bakie - The Trade Asset managers could find themselves paying up to £350,000 a year for research from Barclays under MiFID II. /goo.gl/UvKUNF Exclusive: Goldman Sachs retreats from ETF lead market making Trevor Hunnicutt - Reuters Goldman Sachs Group Inc is pulling back substantially from trading that helps backstop the fast-growing use of U.S. exchange-traded funds, giving smaller firms an opportunity to grab market share. /goo.gl/4dvL4W Barclays Oil Sale Triggers a Huge Number of Trades in Exotic Options Alex Longley - Bloomberg 48 million barrels of WTI options trade early London time; Transactions were consistent with transfer of a bank's book Barclays Plc sold the last part of its oil book to an unidentified buyer, triggering a surge in trading of exotic options written in the era of higher crude prices, according to people familiar with the matter. /goo.gl/ci31Nb
|
| | | |
|
Regions | Stories of local interest from the Americas, EMEA and Asia-Pacific regions | Ghana Banks Turn to Mobile Money in Bid to Boost Deposit Base Moses Mozart Dzawu - Bloomberg A record number of Ghanaians are saving money using mobile phones as lenders push products to lure deposits using technology that is cheaper than building branches. /goo.gl/M5Qj3B China's Newest Stock Connect Sees Foreigners Beating the Index By Jeanny Yu and Cindy Wang - Bloomberg Hangzhou Hikvision almost doubled in Shenzhen this year; Buying became a little 'irrational': Central China Securities Foreign investors have proved to be good stock pickers so far when it comes to their newest entry channel for Chinese stocks, but things may get rougher the rest of this year. /goo.gl/qUMDLb
|
| | | |
|
Brexit | Financials stories regarding the decision of the United Kingdom to leave the European Union | An exit from Brexit would prove a messy affair; Any request to revoke Article 50 requires European Council consent Wolfgang Münchau - FT There is a lot of noise at the moment about an exit from Brexit, as the newly appointed leader of the UK Liberal Democrats put it. The desperation of the pro-Europeans is perhaps best expressed by former prime minister Tony Blair's statement that it is "absolutely necessary that Brexit does not happen". /goo.gl/Qx1aY8 A Brexit transition period is looking more and more likely despite a cabinet rift Julian Harris - City AM Small businesses fear a "cliff edge" if Brexit happens suddenly (Source: Getty) Not even 100 days have passed since Theresa May stood outside Number 10 Downing Street and revealed her plan for a snap General Election. /goo.gl/X2KgyP Brits increasingly see single market as Brexit priority: Ipsos Mori Catherine Neilan - City AM Britons increasingly believe the UK should have access to the single market when the country breaks from the European Union. /goo.gl/YW7y5T
|
| | | |
|
Miscellaneous | Stories that don't quite fit under the other sections | Introducing Alphachain, the Alphaville initial coin offering (Part of the ICOMEDY Series) Financial Times "The way to profit from a bubble is by selling into it," a wise man once wrote. In other news, Alphaville is launching the crooked mainstream media's first ever initial coin offering (ICO). jlne.ws/2vU5YH3
|
| | | |
|
Disclaimer: All John Lothian Newsletters, JohnLothianNews.com, MarketsWiki.com and MarketsReformWiki.com are products of John Lothian News, a division of John J. Lothian & Company, Inc. The opinions expressed in all John J. Lothian & Company, Inc. publications are strictly those of their respective editors. They are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Security futures are not suitable for all customers. Futures and options trading involve risk. Past results are no indication of future performance. Nothing on any John J. Lothian & Company site should be considered an endorsement by any sponsor of any website or newsletter content. © 2017 John J. Lothian & Company, Inc. All Rights Reserved. |
|
|