Blog
Now worried about your secondary credit exposure? You should be.
You no doubt will be wondering how SVB’s risk culture and controls could have degraded to the point where it bought $128bn of mainly long dated fixed income bonds at the height of the bond bubble without protecting the balance sheet from the inevitable and existential threat of interest rate hikes. After all, SVB is not a novice; it has been in business for 40 years, so you’d think it would have grasped the basics of risk management by now.
Worried About the Next SVB?
You no doubt will be wondering how SVB’s risk culture and controls could have degraded to the point where it bought $128bn of mainly long dated fixed income bonds at the height of the bond bubble without protecting the balance sheet from the inevitable and existential threat of interest rate hikes. After all, SVB is not a novice; it has been in business for 40 years, so you’d think it would have grasped the basics of risk management by now.
The CME is on the Enforcement Warpath!
With almost 40 enforcement cases announced between the beginning of December 2022 to mid-January 2023 (a total which excludes summary actions) reaching just shy of $2million in fines, it seems that the CME has significantly ramped up its enforcement efforts. What should firms trading on CME venues such as NYMEX, CBOT and COMEX know about this wave of enforcement? Keep reading below.
What makes Short-Term European Power Market Surveillance So Difficult?
As the SIDC market infrastructure matures over time, the exchanges may work to make such information available as standard. What makes Short-Term European Power Market Surveillance So Difficult? This poses many questions and presents challenges from a transaction surveillance perspective. Without product history there simply cannot be a transaction surveillance calculation. Another consideration is the active and increasing role played by algos and how this might induce your traders to undertake potentially abusive behaviour in the context of the SIDC market design. Some of these challenges emanate from unique market design features and others from the complexity, completeness, and quality of the available transaction data. The Ephemeral Nature of Intraday Products For transaction surveillance solutions to be effective they require transaction data history.
Dodd-Frank Position Limits – A year of living dangerously
As the first anniversary of Dodd-Frank position limits approaches, we reflect on the prospect of enforcement by the CFTC and the many challenges energy and commodity trading firms continue to face in effectively managing this risk.
European Energy Markets in Turmoil – What does this mean for compliance monitoring in power and gas markets?
European power and gas markets are in a state of unprecedented turmoil given disruption to supplies of Russian gas and the ongoing outages in France’s nuclear generation fleet. So severe is this turmoil that many are questioning whether the market itself is still viable and its long-term survival is not guaranteed. So far however, European politicians have not seriously contemplated extreme measures such as the wholesale suspension of the market but even the less invasive measures currently being debated are still likely to have a significant impact on the overall market structure and how firms trade power and gas. But what does this mean for compliance, and in particular those who are tasked with monitoring their traders’ activity for market abuse under REMIT1 and MAR2?
Innovation Through Fintech Partnership: CubeLogic & Numerix
How the Accelerating Pace of Technology Innovation Is Spawning Breakthroughs in Capital Markets Solutions Can 2022 be the year of fintech partnerships? A perfect storm of conditions is brewing that will make strategic collaborations the right solutions for the right...
Position Limits – are they coming or going?
There has been a lot of news recently about changes to the US and European Position Limit regimes for commodity derivatives. If you haven’t been following these developments closely, where exactly do things stand and what do they mean for energy and commodity trading...
A billion reasons to review your market abuse controls
Wednesday 30th September 2020 - If the last six weeks is anything to go by you could be forgiven in thinking that the US Regulatory Authorities are on the warpath to stamp out market abuse in metals markets. Yesterday the Commodity Futures Trading Commission (CFTC)...