Opalesque Futures Briefing » Derivatives and Swaps http://www.opalesque.com/Futures_Briefing Futures Briefing Sun, 20 Nov 2016 23:09:55 +0000 http://wordpress.org/?v=2.7.1 en hourly 1 Generating Alpha & Managing Beta in Global Commodity Markets http://www.opalesque.com/Futures_Briefing/?p=13015 http://www.opalesque.com/Futures_Briefing/?p=13015#comments Mon, 29 Aug 2016 00:05:47 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=13015 Commodities have been traded by mankind since time immemorial. Legend has it that the ancient Chinese traded rice futures over 6000 years ago. The first modern organized exchanges trading commodity derivatives were launched in the 18th century in Japan.
Even if natural buyers prefer not to provide liquidity until the worst turmoil in the market ends, managed connectivity services can…

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SEC’s fund leverage cap needs revising but the idea is sound http://www.opalesque.com/Futures_Briefing/?p=12592 http://www.opalesque.com/Futures_Briefing/?p=12592#comments Sun, 24 Apr 2016 23:33:48 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=12592 To find evidence of retail investors’ use of highly levered funds, read responses to the Securities and Exchange Commission’s (SEC’s) proposals on funds’ derivatives use. As the proposals stand, interest rate swaps are treated the same as commodity futures. Yet in AQR’s managed futures strategy fund, rates positions are three times less volatile than commodities.
AQR analysed seven of the 10…

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The SEC’s Derivatives Proposal http://www.opalesque.com/Futures_Briefing/?p=12351 http://www.opalesque.com/Futures_Briefing/?p=12351#comments Mon, 08 Feb 2016 00:33:42 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=12351 In December, the SEC released a document that addressed the derivatives usage of mutual funds (and exchange-traded funds). The commission has been busy over the past year, having submitted two proposals earlier in 2015, one on portfolio reporting and the other on investment liquidity. I thoroughly saluted the former and was of a mixed mind on the latter.
On the merits…

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SEC Proposes New Limits on Derivative Use http://www.opalesque.com/Futures_Briefing/?p=12234 http://www.opalesque.com/Futures_Briefing/?p=12234#comments Mon, 28 Dec 2015 00:45:30 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=12234 Regulators are concerned about some ETFs’ leverage. New limits could eliminate leveraged ETFs and hamper managed futures funds. Leveraged exchange-traded funds—the hot rods of the trading world—have long drawn the ire of regulators keen on investor protection. And recently proposed rules to curtail the use of derivatives in funds could eradicate the most souped-up products in this $27 billion corner…

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Seeking More Clarity on Derivatives in Mutual Funds http://www.opalesque.com/Futures_Briefing/?p=11626 http://www.opalesque.com/Futures_Briefing/?p=11626#comments Mon, 22 Jun 2015 01:09:26 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=11626 Financial advisers say they would welcome more information on mutual funds’ use of derivatives, something a recent proposal by regulators would require. Scott Keller, a principal at Truepoint Wealth Counsel in Cincinnati, says he’d also welcome additional clarity on funds’ use of derivatives. Keller, whose firm manages $2 billion, says he sold mainly because he was seeking a less actively…

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PIMCO’s Bill Gross was known to be an innovator in the use of derivatives to boost returns http://www.opalesque.com/Futures_Briefing/?p=11471 http://www.opalesque.com/Futures_Briefing/?p=11471#comments Mon, 11 May 2015 01:28:43 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=11471 An investor can receive interest while at the same time use that capital to invest in a position or even a managed futures CTA. The carry strategy is best exemplified in history shortly after the collapsed of Bretton Woods, which ushered in the era of Fiat S.p.A. currency no longer backed by gold.
While data has long supported the notion that…

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Gundlach Follows Gross Into The Quantitative Derivatives Club With New Product http://www.opalesque.com/Futures_Briefing/?p=11172 http://www.opalesque.com/Futures_Briefing/?p=11172#comments Sun, 01 Feb 2015 23:55:49 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=11172 Is it odd that someone so close to the managed futures industry fell behind Bill Gross in establishing a quantitative investment product? Is Jeffrey Gundlach following in the footsteps of Bill Gross? In one respect, the head of DoubLine Capital is already behind the curve and only today is taking corrective action.
It’s almost odd for Gundlach to fall behind Gross…

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U.S. Regulator Says Swaps Rules Need Tweaks To Preserve Global Market http://www.opalesque.com/Futures_Briefing/?p=10894 http://www.opalesque.com/Futures_Briefing/?p=10894#comments Sun, 16 Nov 2014 23:12:48 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=10894 New rules aimed at making derivatives markets safer and more transparent need tweaking to stop the $690 trillion global market splitting up, a top American regulator said on Friday.
Several shallower pools of trading are emerging in what had been one deep, efficient market as brokers outside the United States seek to avoid having to comply with sometimes conflicting U.S.…

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Hedge Fund, Investor Groups Hammer Swaps ‘Stays’ http://www.opalesque.com/Futures_Briefing/?p=10867 http://www.opalesque.com/Futures_Briefing/?p=10867#comments Mon, 10 Nov 2014 00:59:55 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=10867 Hedge funds, insurers and other companies said global regulators shouldn’t implement new rules aimed at protecting the financial system against the failure of big banks. At issue are changes endorsed by global banking regulators that would require banks and investors to give up their contractual rights to terminate swaps contracts with a troubled financial institution.
Instead, the firms would have to…

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Europe attracted by US derivatives pull http://www.opalesque.com/Futures_Briefing/?p=10865 http://www.opalesque.com/Futures_Briefing/?p=10865#comments Mon, 10 Nov 2014 00:59:44 +0000 shailaja http://www.opalesque.com/Futures_Briefing/?p=10865 European derivatives trading has had a distinctly American flavour in recent months. Earnings reports from CME Group, the world’s largest futures exchange, and Intercontinental Exchange, its close rival, have shown a rise in both interest rates trading and credit default swaps (CDS) clearing to the US from the old continent.
First CME Group, owner of the actively-traded eurodollar futures contract, said…

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