Feature/Risk Management
Bad clocks block FX best-ex
To get a good deal in fast-moving FX markets, buy-side firms need to know the time. Some of them don’t
Comparing apples and apples
With clients expecting more transparency, it is vital for firms to be in control of costs. The key is determining the true all-in price of execution
Price and perfect execution
Firms are trying to give clients visibility on measuring whether the price they are receiving is a good one, but the cost of execution is variable and hard to pinpoint – and it’s not just about price
For a few dollars more: Japan banks tackle dollar/yen basis jump
The dollar/yen cross-currency basis has widened nearly 50% in recent months due to a surge in demand from Japanese banks and regulatory constraints curbing supply from US dealers. With trading costs soaring, Japanese banks are turning to more exotic…
Grand redesign
Non-bank market-makers are increasingly being viewed as serious players as they set about building customer franchises amid a wide-scale bank pull-back
Currency manager calls for Swiss franc liquidity inquest
The collapse of foreign exchange liquidity during and after the huge Swiss franc move on January 15 caught market participants by surprise. Some are calling for an official enquiry
Cross-border resolution hinges on trust
Work to develop a cross-border recovery and resolution regime is progressing, but the need for individual regulators to sign co-operation agreements is seen as a potential problem. It boils down to trust – and that worries some participants. Michael Watt…
Corporate cash seeks new home as money-market reforms loom
New regulation on both sides of the Atlantic threatens to make money-market funds less attractive for corporate treasurers. Banks are hoping this cash will flood into fixed-term deposits instead, helping them meet incoming liquidity ratios, but they’re…
FX Week meets Alan Bozian, CLS
During his most recent visit to London in mid-November, Alan Bozian, chief executive of CLS, met with Joel Clark to discuss the transformation agenda he has been pushing since joining CLS in 2010
FX Invest: Implications for collateralisation under new CCP model
Saima Farooqi looks at the wave of upcoming regulations relating to central counterparty clearing, and what it means for collateral management
Corporates assess their hedging options
Ben Nicklin, FX structurer at Royal Bank of Scotland in London, looks at the rise of option-owning corporate hedging strategies
Ban on rehypothecation could increase derivatives costs
Investors have become more aware about the security of collateral since the collapse of Lehman Brothers. A number of hedge funds are now insisting margin posted on derivatives trades is not rehypothecated – a trend that could drive up costs. By…
The challenges of CVA
The onset of the financial crisis spurred banks to charge for counterparty credit risk in their forex dealings. But how to do that is proving theoretically and practically challenging. By John Ferry
UK's FXJSC puts brakes on forex CCP
The London Foreign Exchange Joint Standing Committee (FXJSC) has ruled out the immediate need to implement a central clearing facility to manage counterparty risk (a CCP) in foreign exchange, citing a series of mismatches in market conventions in a white…
CCPs may need public sector support
BASEL - Central counterparties (CCPs) could require public sector support in the event of simultaneous defaults of a number of participants, according to economists at the Bank for International Settlements (BIS).
Trading on stat-arb
Irene Aldridge, managing partner at Able Alpha Trading, in New York examines the stat-arb technique
Adapt or fail
Since October last year, extreme movements in South Africa's foreign exchange rate have caused offshore hedge funds to exit the market, while dealers have been reluctant to take on risk. Those that remain active have had to adapt their behaviour. By Mark…