Structured products
Static data moves forward
Firms tackling high-speed and information-intensive tasks such as straight-through processing or risk management without accurate instrument and counterparty reference data may be taking enormous operational and credit risks. Clive Davidson reports on…
Job moves
QUOTE OF THE MONTH: - “The perception of government support may induce the counterparties of government-sponsored enterprises to apply less vigorously some of the risk controls that they apply to manage their over-the-counter derivatives exposures”…
Trading commodities and correlation
Dealers are devising commodity derivatives products to attract new investors desperate for an alternative to the poorly performing financial markets
Dealers debate regime change in US interest rate volatility
Has the US interest rate options market entered a new period of sustained higher implied volatility? Deutsche Bank says yes, but other leading dollar interest rate derivatives dealers say it is too early to tell. Mortgage investors and options writers…
Mixed outlook for derivatives staff
After a disappointing 2001, the job market for derivatives specialists looks set to rebound this year in certain areas, while other areas remain stagnant or face even further declines. Gallagher Polyn identifies the hot spots and those areas to avoid in…
Retail product design innovations
Retail investors the world over are looking for alternatives to the faltering stock and fixed-income markets. Derivatives dealers looking to tap this demand are rolling out new products and revising old ones for the retail audience. John Ferry and Navroz…
Fewer options in 2001 | A Risk survey
The foreign exchange options market cooled off significantly last year, as September 11 and lower forex volatility kept dealers away. Risk’s third annual survey of 13 large forex options houses reveals that their combined 2001 volumes fell by $1.1…
WorldCom spreads blow out
The cost of protection on WorldCom’s five-year debt blew out today, following the resignation of chief executive Bernard Ebbers.
Basel regulators hope for SME solution by mid-June
Global banking regulators are optimistic they can resolve by mid-June the vexed question of the treatment of lending to small to medium-sized enterprises (SMEs) under the proposed Basel II bank capital adequacy Accord.
Rates Market Update: US spreads hit four-year low
US swap spreads reached a four-and-a-half year low this week, as expectations of increased treasury issuance combined with a large amount of corporate activity brought an influx of floating rate receivers into the market. Ten-year swap spreads ended the…
Morgan Stanley arranges €4bn-plus synthetic CDO
US investment bank Morgan Stanley is arranging a €4 billion plus synthetic collateralised debt obligation (CDO) due to be managed by London-based investment boutique Cheyne Capital Management.
Credit Markets Update: Repsol spreads widen due to Argentina concerns
The cost of credit protection on Repsol, the Spanish-Argentine oil and energy group, widened 30 basis points today after Moody’s placed it under review for possible downgrade yesterday. Moody’s concerns reflected the ongoing deterioration in the economic…
Nera readies for CDO ‘notching’ investigation
New York-based economic consulting firm National Economics Research Associates (Nera) has finalised its research plan for its structured finance ratings comparability study.
Volcker challenges the benefits of financial engineering
Paul Volcker, US Federal Reserve chairman between 1979 and 1987 and present chair of the Independent Oversight Board for embattled Enron auditor Arthur Andersen, has said he is "ambivalent" about the value of financial engineering to the US economy.
LSE predicts UK equity derivatives surge
Clara Furse, chief executive of the London Stock Exchange (LSE), today warned that stamp duty on UK share trading could increasingly damage London’s competitive advantage in international financial markets and thereby reduce the likelihood of the UK…
Credit Markets Update: Telecoms reeling on bad news
The battering of US telecoms credit default spreads continued this week, following a grim financial forecast by WorldCom last Friday that sparked a flurry of downgrades on the company’s debt. Five-year protection spreads on WorldCom widened to 1,700…