Structured products
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…
Hedge fund backed by Lehman launched today
Edgeworth Capital, a London-based hedge fund backed by investment bank Lehman Brothers, was launched today. The firm's first two funds, a global fund following a macro strategy and a pan-European long/short equity fund, will be launched in September.
JP Morgan Chase and Deutsche join Currenex as member banks
JP Morgan Chase and Deutsche Bank have joined Currenex, the electronic foreign exchange trading portal. Currenex said the additions will enhance liquidity on the FX trading platform, and the news follows from the collapse of rival Atriax earlier this…
SGAM to hedge Santander’s Supersatisfaction II
SG Asset Management (SGAM) has won a contract to hedge an expected €1 billion of equity-linked deposits issued by Spanish bank Santander Central Hispano (SCH).
Credit Markets Update: telecom spreads rally in strong US equity market
This week telecoms continued their rally on the back of a strong US equity market, with spreads tightening by up to 10 basis points. But telecom equipment makers were punished by weak results from Nokia, and saw credit default swaps widen.
Rates Markets Update: Swaps ride out terrorist scare
Interest rate swap spreads continued in a narrow range this week, despite a slight widening caused by the fear that the crash of a small plane into a Milan office building on Thursday was the work of terrorists. Initial fears led to 10-year US dollar…
Isda AGM: Sweden could pull back from swaps market
More bank credit rating downgrades could prompt Sweden’s Debt Office to pull out of the swaps market. That was the warning delivered today to the International Swaps and Derivatives Association meeting by Erik Thedéen, head of the debt management…
Isda AGM: No room for doom and gloom
At the International Swaps and Derivatives Association's AGM today, outgoing Deutsche Bank chairman Rolf Breuer predicted more strong growth for the derivatives industry, despite problems faced by other financial markets.
Credit Markets Update: Spreads narrow as outlook turns positive
US Federal Reserve Chairman Alan Greenspan’s testimony before Congress today indicated that the Fed does not plan to raise interest rates any time soon and this, along with signs that the US economy is strengthening, caused spreads in the credit…
Isda AGM: New Isda board members unveiled
Henning Bruttel, head of foreign exchange and local markets at Dresdner Kleinwort Wasserstein in Frankfurt, was made the new vice-chairman of the International Swaps and Derivatives Association today. He replaces Thomas Montag, managing director of…
Structured products
Despite hedge funds promising absolute returns, plenty of buyers want guarantees on top
An independent voice
John Butcher talks to Narayan Naik about the Centre for Research and Education's new two-day course which aims to lift the lid on the workings of hedge funds
Yankee doodle
Jeff Benjamin discovers how a hedge fund boutique in Massachusetts is looking beyond simple outperformance towards a more targeted approach to business
Bucking the downturn
The Decillion Convertible Arbitrage Fund has risen 16% in the past eight months despite concerns about volatility and credit in the market
Managing the future
Market volatility adds to the woes of global macro and managed futures