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Bank-run fund derivatives platforms hit records
JP Morgan’s Nexus has seen balances double, while AUM on UBS’s Neo have tripled
Language barrier: quants slog to teach investing bots to read
Training models to interpret text can be dull; doing it badly can be costly
Litigation threats seen delaying SEC climate disclosure rules
Efforts to demonstrate materiality of exposures to investment decision-making is taking longer than expected, say lawyers
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Quotes
There isn’t anything that really constrains them [the US Financial Stability Oversight Council] from going back to a focus on systemically important non-bank institutions and… the transmission channels
Marc Saidenberg, EY
There’s really no downside to scenario analysis unless it causes you to do something that harms you, and that’s pretty rare
Aaron Brown, formerly of AQR
When you look at the volume on the private bank business [in autocalls] it is a multiple compared to last year. It’s a very, very big shift for investors
Cross-asset sales head at a US bank in Hong Kong
Editor's Choice
Regulators setting climate rules would be ‘enormous failure’
Risk Live: ‘Trust markets’ not regulators to move capital away from big carbon emitters, says LGIM
Big Figure
Margin mayhem
Insurers and pension providers in the eurozone likely exacerbated the run on the region’s money market funds (MMFs) in March, as they withdrew cash en masse to cover huge margin calls on derivatives triggered by Covid-induced volatility. Researchers at the European Central Bank found a strong correlation between MMF inflows and outflows and the variation margin payments made to and from insurance corporations and pension funds related to their interest rate and currency derivatives.
Read the full articleRisk Management
Litigation threats seen delaying SEC climate disclosure rules
Efforts to demonstrate materiality of exposures to investment decision-making is taking longer than expected, say lawyers
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