First Read

NextGen Market Training
By Doug Ashburn and Jim Kharouf – JLN

The long-standing tradition of bringing young students into the industry to learn all of the ins and outs of the business continued last Friday at Trading Technologies. TT hosted Campus Connect Algo Showcase, as students from four universities presented their trading ideas and algo trading systems to the audience.

Students from the University of Illinois, Loyola University, DePaul University and Illinois Institute of Technology (See more on IIT becoming Illinois Tech below), showed everything from how they coded a trading program to how they used TT’s Algo Design Lab to test out trading ideas. Some projects made money, some did not. But as many of the best traders have said time and again, you learn more from the trades that don’t work than from those that are successful.

As we are keen to remind people during our MarketsWiki Education events, bringing the next generation of participants into our markets is not the same structure, with summer runners on the floor, as it used to be. The old pipeline has been replaced by a new one involving technology, technology and more technology. But “setting the hook” is not as easy nowadays. It is programs like TT Campus Connect, led by Leo Murphy, that are bridging the gap.

What we saw (and what we learned from talking to the participants at a reception down in TT’s Tech Tap) is that, though all the tools are there, the students still need parts of the old pipeline in order to land that first job out of college. One answer, of course, is to get really good at writing code. There is an acute need for developers to help implement the trading strategies of the last generation. The other is simply understanding how to develop and execute a trading strategy using the tools that are available.

Opportunities are there; they are just harder to find, and the competition is fierce. We close with a look at one of those opportunities, from last summer’s MarketsWiki Education series.

Joseph Niciforo, HC Technologies – Profiles in Risk: Vision and Discipline
JohnLothianNews.com

“If you don’t have disciplined risk management, you’re not going to be in the game.”

After earning a law degree in 1988, Joe Niciforo turned down a six-figure offer to join a big law firm, opting instead for a salary at 30 percent of that number, to work as a trader for the legendary Paul Tudor Jones II. He would eventually become a partner and managing director at Tudor Investment Corp, but his trading career almost got cut short once when he violated his own risk parameters and ended up taking a big loss. The next day, he received a phone call from Jones, who said, “If you ever lose more than $15,000 for me, we’ll always be friends; we’ll never do business.”

His latest venture with Tudor, LaunchPad Trading, seeks out and grooms young portfolio managers, who, hopefully, won’t make the same mistakes he did when he was a young, cocky trader.

Watch the video at MarketsWikiEducation.com »
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CFTC’s TAC Meeting for Tuesday Has Been Cancelled; To Be Reschedule ASAP
***** And that is all I have to say about that.

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IIT changes its brand name to Illinois Tech
Ally Marotti – Chicago Tribune
The Illinois Institute of Technology has all but dropped the name IIT in favor of Illinois Tech, staking a claim to the hearts, minds and SEO of a technology-driven world.
goo.gl/GoR7Tm

***** Our good friends at IIT get new and improved identity.

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Goldman Sachs’ Plan To Get More Older Women Back To Work; The odds are stacked against women over 50 who want to return to work. This program tries to help them.
Alexander C. Kaufman, Business Editor, The Huffington Post
About 43 percent of women with children leave their jobs. If they choose to return to work later in life, they face dismal jobs prospects in a market that appears to be stacked against women over 50.
goo.gl/gQ3PRQ

***** Doing God’s work again.

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NFA Regulatory Requirements
For FCMs, IBs, CPOs, and CTAs
goo.gl/x1LaZs

***** I wish I had seen this before the weekend. It would have made good weekend reading.

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NFA Investor Newsletter
NFA
National Consumer Protection Week: March 6 to 12, 2016
Avoid financial pitfalls by following these tips from FINRA’s Alert Investor
Money Smart in 2016
Visit NFA at Traders Expo New York
Recent enforcement actions
goo.gl/kKHwdI

****** NFA has all the fun.

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Survey Says – Give the readers what they want!
There is still time to participate in our 2016 survey campaign. Help us help you by giving us three minutes of your time and sharing your thoughts. Plus, we tried to make it fun and colorful. The final kicker? You could win an Apple Watch. Click HERE to get started.

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Bridging the Week by Gary DeWaal: January 18 – 22 and 25, 2016 (Manipulation; CFTC’s Priorities; Misstating Fees and Valuation; Canada OTC Clearing; CFTC’s Finances)
by Gary DeWaal – Katten Muchin Rosenman LLP
There was little international regulatory activity involving the financial services industry last week. The Chairman of the Commodity Futures Trading Commission discussed his 2016 priorities at an industry gathering of lawyers, and one big surprise was that position limits were barely mentioned. In Canada, regulators proposed collateral protection rules for cleared over-the-counter derivatives. Back in the United States, it was the CFTC itself that received a qualified opinion by an accounting firm regarding its fiscal years 2014 and 2015 financial statements, and a finding that it had a material inadequacy in internal controls. As a result, the following matters are covered in this week’s edition of Bridging the Week:
bit.ly/15ZyR7H

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Friday’s Top Stories
The top click-getter on Friday was not a story, actually, but rather our MarketsWiki page on swap execution facilities, as the CFTC had just given permanent SEF status to 18 temporary registrants. Number two on the list was unexpectedly popular – the Bloomberg story “Saudi Arabia’s Secret Holdings of U.S. Debt Are Suddenly a Big Deal”. Third place went to the tie-up between our friends down under and our other friends who are forging ahead on blockchain technology – Australia’s ASX set to lead in blockchain for public companies

Lead Stories

Chi-X Global sells Asian units to JC Flowers
Philip Stafford in London and Peter Wells in Hong Kong – FT
Chi-X Global, a share trading venue operator backed by a group of banks, has called time on its challenge to incumbent exchanges in Asia by selling its businesses in Australia, Japan and Hong Kong to JC Flowers, the US private equity group.
goo.gl/OvgxEg

Michael Bloomberg exploring US presidential bid
Matthew Garrahan in New York and Demetri Sevastopulo in Washington – FT
Michael Bloomberg, the former mayor of New York, is exploring an independent run for president, a move that would further complicate a White House race that has been completely upended by insurgent, anti-establishment candidates. The founder of the eponymous financial information group who has considered running for president in previous elections is willing to spend $1bn to finance a run as an independent, according to people familiar with the matter.
goo.gl/o0AwwD

Talk of Fed ‘policy error’ grows
Robin Wigglesworth – FT
Gathering for the first time after their epoch-ending decision to raise interest rates in December, the backdrop couldn’t be more different for Federal Reserve policy officials. The long-awaited rate increase went smoothly, but simmering concerns over China, the global economy as a whole, deflating commodities and financial market valuations have since risen to the fore. Even fund managers that were relaxed about slightly tighter monetary policy last month are now wondering whether that was complacent.
goo.gl/k9HKBV

The Case for the World Economy’s Defense Is Made as Stocks Swoon
Simon Kennedy – Bloomberg
`There’s a gap of perception versus reality,’ investor says; Roubini rules out repeat of 2008-style economic collapse
Economists make astrologers look good, John Kenneth Galbraith once said. In the 1960s, Paul Samuelson congratulated stock investors on predicting nine of the last five recessions.
goo.gl/FzQBil

Cracks Exposed in U.S. Bond Market as Liquidity Woes Warp Prices
Liz McCormick – Bloomberg
Buyers paying almost twice average premium for benchmark notes; `Erratic behavior’ pervades in Treasuries, according to RBC
In today’s bond market, there’s plenty of hand-wringing about liquidity, or rather, the lack of it.
goo.gl/6F1FR6

Why the Fed Is the Root of Much Market Turmoil; Fed is a key reason markets have plunged and risk of recession rising
By GREG IP – WSJ
Not long ago, this week’s Federal Reserve meeting looked like a nonevent. Having begun to raise rates in December, the central bank was expected to stand pat while signaling more hikes later on.
goo.gl/SLsXhv

Here’s how the market rout could blow the Fed off course
Howard Schneider, Reuters
Federal Reserve officials are playing it cool for now, but roughly $2.5 trillion of stock market value wiped out in the past three weeks and a possible consumer pullback could throw the Fed off its course of gradual interest rate hikes.
goo.gl/QXzmjs

Strange Trades Are Happening in Global Markets
Phil Kuntz – Bloomberg
Six charts show how strange trading has gotten this year; Two dozen countries’ companies now worth less than assets
Have the global financial markets lost their collective mind? Last week saw the value of Hong Kong’s benchmark stock market briefly dip below how much its member companies’ assets are worth. Foreign exchange traders are punishing currencies even in countries with improving economies, and Russia’s ruble has fallen so far that it’s a third more undervalued than the last time the country’s oil was as cheap as now.
goo.gl/zHCJIP

Financial fears has investors on a stock-selling spree
By John Aidan Byrne – NY Post
America’s affluent middle-class investors embarked on a stock-selling spree in 2015, a stomach-churning sell-off that shows no signs of abating soon, according to a new study.
goo.gl/vc6jVJ

CFTC to propose SEF trading rules in few months, Massad says
Neil Roland, MLex (Subscription Required)
The US Commodity Futures Trading Commission plans to propose rules this spring aimed at improving derivatives trading on swap execution facilities and attracting traders to the venues, Chairman Timothy Massad said.
bit.ly/1UkU2UZ

Banks vs. Bond Markets: Give Credit Where It’s Due; European lending conditions look up as bank share prices slide
By PAUL J. DAVIES – WSJ
You wouldn’t think it from bank share prices, but Europe’s lending outlook has been getting rosier. In fact, there are signs of a two-speed credit market with banks open for business even as bond markets stutter.
goo.gl/P54JXg

Wall Street’s battle of the bankers
Sujeet Indap and James Fontanella-Khan – FT
Under different circumstances, Joe Perella might admire the entrepreneurial pluck of his erstwhile colleague Michael Kramer. Mr Perella, 74, is a legend on Wall Street for his role in transforming mergers and acquisitions from a banking backwater into a glamorous, big- money business. He is also known for making dramatic exits from two big banks — First Boston and Morgan Stanley — to set up boutique firms bearing his name.
goo.gl/ycsGty

Fear of a Chinese bogeyman is unduly alarmist
John Plender – FT
In the not so distant past, most actuaries would have responded to a sharp market setback of the kind we witnessed this January with equanimity. They welcomed a fall in equities on the basis that pension funds could buy streams of dividend income more cheaply to meet pension liabilities. If a market correction coincided with high inflation, as in the 1970s and 1980s, there was a double benefit because a higher yield on government bonds meant that pension liabilities shrank courtesy of a higher discount rate.
goo.gl/Ovprcs

Amid mounting bills, farmers forced to sell grain at low prices
BY KARL PLUME AND P.J. HUFFSTUTTER – Reuters
Facing mounting bills and nervous creditors, U.S. farmers are beginning to sell off their crop stockpile – sometimes at a loss – and easing a months-long logjam prompted by the lowest grains prices in at least five years.
goo.gl/8x6oL1

Number of women on UK IPOs hits ‘depressing’ low
By Lucy Burton and Walter Hemmens – Financial News
The UK’s largest companies may have achieved their target to get more women into boardrooms during 2015, but at the other end of the market, the number of female board members at businesses that were being listed for the first time dropped to a “depressing” low of 10.1% – worse than it was in 2014 and 2013.
goo.gl/OXGyYQ

Bonus Gains Expected by More Than 33% of London Finance Staff
Donal Griffin – Bloomberg
Two-thirds of employees anticipate a bonus for last year; Survey by recruitment firm includes bankers and traders
More than a third of London’s finance staff expect a higher bonus for 2015 than the previous year, a recruitment company said, even as lenders from Barclays Plc to Deutsche Bank AG struggle to boost revenue.
goo.gl/1c4c3j

Regulatory

CFTC Grants Registration to 18 Swap Execution Facilities
CFTC
The U.S. Commodity Futures Trading Commission (CFTC) issued Orders granting registration to 18 swap execution facilities (SEFs). The SEFs issued a Registration Order today previously were operating under temporary registration status. SEFs are trading facilities that operate under CFTC’s regulatory oversight for trading and processing swaps. SEFs were authorized to be created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 to provide greater pre-trade and post-trade transparency to the swaps market.
1.usa.gov/1ZGXBpP

***DA: On Friday, we put in a blurb about the permanent registrations, which we found out about through Chairman Massad’s prepared remarks for a speech he was about to deliver. The press release came afterward.

Statement of Commissioner J. Christopher Giancarlo Regarding Full Registrations of Swap Execution Facilities
CFTC
I commend the Division of Market Oversight staff for completing this step to enhance the safety and soundness of U.S. financial markets. The staff’s work was made unreasonably more complicated by having to apply the CFTC’s misconceived swaps trading rules to the distinct liquidity characteristics, long-established market practices and sophisticated market structure of the global swaps markets.1 Yet, completing this registration process reduces uncertainty for market participants who have been served by temporarily registered SEFs for the past two plus years.
1.usa.gov/1ZRCaI3

***DA: Next step – tackle the list Mr. Giancarlo laid out in last year’s white paper, neatly summarized on MarketsReformWiki

CFTC urged by Senate Democrats to lower swap dealer threshold
Anjelica Tan, MLex (Subscription Required)
Six US Senate Democrats called on the nation’s main derivatives regulator to lower the swap dealer registration threshold to expand oversight of the energy market.
bit.ly/1ZXiF0M

S.E.C. Is Criticized for Lax Enforcement of Climate Risk Disclosure
By DAVID GELLES – NY Times
As recently as 2011, shares in Peabody Energy, the world’s biggest private sector coal company, traded at the equivalent of $1,000. Today, they hover around $4 each. Over that time, investors who held the stock lost millions.
goo.gl/uwKyIl

A Legal Battle Brews Over the Power of America’s Consumer Finance Watchdog; Four years after the agency’s creation, debate still rages over its authority
By YUKA HAYASHI – WSJ
In late 2014, an in-house judge for the government’s new consumer-finance watchdog ruled that a New Jersey lender took illegal “kickbacks” from mortgage insurers, boosting costs for borrowers. The company said the decision invoked a new, overly aggressive interpretation of an old law and appealed to the agency chief.
goo.gl/ghn99g

Self-Regulatory Organization (SRO) Rulemaking and National Market System (NMS) Plans
SEC

  • BATS: Notice of Filing of a Proposed Rule Change to Rule 14.11(i), Managed Fund Shares, to List and Trade Shares of the iShares iBonds Dec 2023 AMT-Free Muni Bond ETF, iShares iBonds Dec 2024 AMT-Free Muni Bond ETF, iShares iBonds Dec 2025 AMT-Free Muni Bond ETF, and iShares iBonds Dec 2026 AMT-Free Muni Bond ETF of the iShares U.S. ETF Trust (Release No. 34-76954; File No. SR-BATS-2016-02; January 21, 2016)/li>
  • C2: Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1 and 2 Thereto, Relating to Price Protection Mechanisms For Quotes and Order (Release No. 34-76959; File No. SR-C2-2015-033; January 21, 2016)/li>
  • CBOE: Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of Proposed Rule Change, as Modified by Amendment Nos. 1 and 2 Thereto, Relating to Price Protection Mechanisms For Quotes and Order (Release No. 34-76960; File No. SR-CBOE-2015-107; January 21, 2016)/li>
  • ISE: Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend the Schedule of Fees (Release No. 34-76957; File No. SR-ISE-2016-03; January 21, 2016); see also Exhibit 5/li>
  • NASDAQ: Notice of Filing of Proposed Rule Change to Adopt a Limit Order Protection and a Market Order Protection (Release No. 34-76956; File No. SR-NASDAQ-2016-005; January 21, 2016); see also Exhibit 5/li>
  • NASDAQ OMX BX: Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding SQF Port Fees (Release No. 34-76952; File No. SR-BX-2016-003; January 21, 2016); see also Exhibit 5/li>
  • NYSE Arca: Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Exchanges Schedule of Fees and Charges to Define the Term Exchange Traded Products and to Provide for the Proration of Annual Fees Applicable to Exchange Traded Products That Have Liquidated (Release No. 34-76969; File No. SR-NYSEArca-2016-13)/li>
  • NYSE Arca: Notice of Filing and Immediate Effectiveness of Proposed Rule Change Establishing the NYSE Arca Order Imbalances Proprietary Market Data Product (Release No. 34-76968; File No. SR-NYSEArca-2016-10)/li>
  • NYSE Arca: Notice of Designation of a Longer Period for Commission Action on Proposed Rule Change, as Modified by Amendment No. 1, Relating to Listing and Trading of Shares of the Cumberland Municipal Bond ETF under NYSE Arca Equities Rule 8.600 (Release No. 34-76955; File No. SR-NYSEArca-2015-93; January 21, 2016)/li>
  • Phlx: Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend a Quote Spread Parameter Provision (Release No. 34-76966; File No. SR-Phlx-2016-06)

/goo.gl/h0yuDn

Exchanges & Trading Facilities

Stock Exchanges Are Eating Your Returns
By Larry Tabb – Bloomberg
Over the past decade, the widespread availability of information and new technologies has helped establish the most level playing field in financial markets we’ve ever seen.
goo.gl/1VmNxl

IntercontinentalExchange’s NYSE Says IPO Recovery Could Be Months Away: Bloomberg
Wallstreet.org
IntercontinentalExchange Group (NYSE:ICE) shares were higher over 3% on Friday even as the Bloomberg cited New York Stock Exchange head Tom Farley as saying a recovery in the initial public offering market could be months away. “We will have to wait until volatility comes down to see that rekindle,” Farley told Bloomberg TV in an interview. “It is likely a matter of months, not days or weeks.” ICE trades in the upper half of the 52-week range between $202.24 and $266.74.
bit.ly/1S5JWd7

Successful Launch of SGX SLInG LNG derivatives
Commodities Now
Singapore Exchange is pleased to announce the successful launch of its new SGX FOB Singapore SLInG LNG derivatives contracts on 25 January 2016. A total of 10,000 mmBTU of SGX FOB Singapore SLInG LNG Swaps in the March 2016 contract month were transacted between Trafigura Pte Ltd and Pavilion Gas Pte Ltd and cleared on SGX through SGX Clearing Members, DBS Vickers Securities Limited and SG Securities (Singapore) Pte Ltd.
bit.ly/1S5Ke3I

HKEx considers expanding cross-border stock connect to IPO market
Asia Asset Management – The Journal of Investments & Pensions
Hong Kong Exchanges and Clearing (HKEx) is considering expanding the cross-border stock linkage between the Mainland and Hong Kong that allows investors in the two locations to access each other’s primary stock markets.
bit.ly/1S5KjEF

LME Said in Talks With Banks to List London Gold Contracts
Eddie Van Der Walt, Agnieszka De Sousa – Bloomberg
Goldman Sachs, ICBC and Citigroup among banks, people said
LME has said previously it wants to expand in precious metals
The London Metal Exchange is in talks with the World Gold Council and five banks about the possibility of introducing futures contracts on gold and standardized central clearing, according to two people familiar with the matter.
goo.gl/JCynQp

Politics

Republicans hope Bloomberg would split Democratic vote
Demetri Sevastopulo and Sam Fleming in Washington and Matthew Garrahan in New York – FT
Republican presidential contenders have welcomed the news that Michael Bloomberg is considering a run for the White House, arguing that the former New York mayor would siphon support away from the eventual Democratic nominee.
Donald Trump, the property mogul and former star of The Apprentice, said he would be “very happy” at the prospect, following reports that the founder of the eponymous financial information group was willing to spend at least $1bn of his estimated $39bn fortune on an independent campaign for the presidency.
goo.gl/iSAEA8

‘The Triumph of William McKinley,’ by Karl Rove
By IRA KATZNELSON – NY Times
Writing six decades after the election of 1896 brought the retired Ohio governor William McKinley to the White House, the political scientist V.?O. Key Jr. identified the Democratic defeat as “so demoralizing and so thorough that the party could make little headway in regrouping its forces until 1916.” The scale of this Republican success — a moment that ushered in a period of Republican Party ascendance that lasted until the election of Franklin Roosevelt in 1932 — draws the attention of the prominent political strategist Karl Rove, who also views McKinley’s victory over the charismatic William Jennings Bryan as pivotal. Rove is in awe, rightly so, of McKinley’s political achievement, and his richly detailed, moment-by-moment account in “The Triumph of William McKinley” brings to life the drama of an electoral contest whose outcome seemed uncertain to the candidate and his handlers until the end.
goo.gl/TmDAZ7

Hedge Funds & Managed Futures

Asset managers: out of the closet
FT – LEX
Were index hugging a crime, there would be a lot of guilty fund managers. According to a study last year, up to half the funds in some European countries charge their investors for “active” management — where a manager tries to beat a benchmark — but have holdings that closely resemble those of their benchmarks. Investors can typically buy such index exposure directly at much lower fees.
goo.gl/KS8nvE

Templeton’s $42 Billion Manager Says the Gloom Has Gone Too Far
Tom Redmond – Bloomberg
Heather Arnold spends all day assessing the prospects for the world’s economies and their stock markets, and doesn’t see too much to worry about.
Heather Arnold.
goo.gl/MQovKy

Asset management employees’ pay down 17%
Attracta Mooney – FT
Asset management professionals globally took a pay cut of almost a fifth in 2015 as the fund industry grappled with its worst year of profitability since the financial crisis.
goo.gl/rZH0BY

Inside the $80M scam that rocked the art world and hits courts this week
By Michael Kaplan – NY Post
The Rothko had been forged. The heir never existed. And the De Soles weren’t alone as victims of deception. From 1994 until 2009, Knoedler & Co. admittedly — but, the claim goes, unknowingly — sold 31 other bogus paintings. Through those sales, the gallery raked in some $80 million. Luke Nikas, Freedman’s lawyer, says that she earned $10- to $12-million between 1994 and 2008. Moguls and megalevel tastemakers all thought they were buying works by such abstract expressionist blue-chippers as Jackson Pollock, Robert Motherwell and Willem de Kooning.
goo.gl/ea6ugU

Hedge-Fund Firm Man Group Hires HSBC’s Head of Emerging-Market Debt; Guillermo Osses joins as Man looks to expand its presence in trading credit
By LAURENCE FLETCHER – WSJ
Hedge-fund firm Man Group PLC has hired HSBC Global Asset Management’s head of emerging-market debt, said a person familiar with the matter.
goo.gl/JPBpCP

The 29-Year-Old Bond Picker Vindicated by Call That Returned 36%
Isabella Cota, Ben Bartenstein – Bloomberg
Axtel’s bonds jump after Alfa said it acquired the company; The notes sank to a record low in March amid global rout
When the bonds of Mexican phone company Axtel SAB sank to a record low in March, Mariela Anguiano had some explaining to do.
goo.gl/3Tby5E

Number of ‘dog’ funds up by nearly 50%; Aberdeen continues to top list
Daniel Flynn – Investment Week
The wealth manager’s twice yearly Spot the Dog report highlights OEICs and unit trusts that have underperformed their benchmarks for three consecutive years, and by more than 10% over a three-year period.
goo.gl/lEJINS

Asset Managers Are Hard Hit; Low interest rates, rising competition and market swoon press industry
By SARAH KROUSE – WSJ
The market’s glum start this year is the latest problem to beset the large, publicly traded U.S. asset managers.
goo.gl/Kxh5JZ

Banks & Brokers

‘Too Big to Fail’ Banks Thriving a Few Years After Financial Crisis
By WILLIAM D. COHAN – NY Times
Nearly eight years after the onset of the financial crisis, its unintended consequences continue to startle and amaze.
goo.gl/LLDMw4

Citi: ‘Quantitative Tightening’ Is Real, and the Recent Market Selloff Proves It
Luke Kawa – Bloomberg
A siphoning of the global liquidity punch bowl is fueling the 2016 downdraft in global equities, says Matt King, Citigroup Inc.’s head of credit product strategy, jumping on a thesis first promulgated by Deutsche Bank in September.
goo.gl/LxGSkz

‘Superbrokers’ Emerging in Asian Futures
Markets Media
As the largest ‘Tier 1’ banks and futures commission merchants continue to retrench globally, local trade handlers in Asian markets are seizing the opportunity. Specifically, CIMB Group and RHB Bank of Malaysia and Singapore-based UOB Bullion and Futures Ltd are among regional players adding new futures business and bulking up to ‘superbroker’ size, according to Lewis Richardson, derivatives business development manager at Fidessa.
bit.ly/1nqBqc1

Clearing & Settlement

US watchdog approves new venues for trading interest rate swaps
Philip Stafford in London and Joe Rennison in New York – FT
US regulators on Friday formally recognised 18 new venues for trading interest rate swaps, reflecting the industry’s growing uptake of electronic trading under new rules.
goo.gl/2X7esm

US regulator targets swaps, clearing rules
Futures & Options World
The US Commodity Futures Trading Commission (CFTC) is ramping up efforts to achieve international harmonisation of swap trading rules and clearing house stress testing standards after naming them as priorities for 2016. In a speech to ABA Derivatives and Futures Law Committee on Friday, CFTC chair Timothy Massad said the Commission was pursuing a number of initiatives in early 2016 aimed at harmonising with European regulators clearing house stress testing standards as well as swap trading rules.
bit.ly/1S5K9gs

CCP interoperability under EMIR
Cummings Law – Lexology
The European Systemic Risk Board (ESRB) has published a report on the systemic risk implications of central counterparty (CCP) interoperability arrangements under EMIR. In the ESRB’s opinion, CCP interoperability arrangements can have implications for financial stability in two different ways, namely: (i) they can help to contain systemic risks in a situation where a number of different CCPs clear the same financial instruments; and (ii) they can, however, also have systemic risk implications as the establishment of interoperable links introduces a significant element of complexity into the overall risk management system and adds a channel for direct contagion between two or more CCPs.
bit.ly/1S5JR9m

BNP Paribas Securities Services launches EURGCPlus service offering
Automated Trader
BNP Paribas Securities Services has announced the launch of clearing, settlement and custody services for clients trading Euro cash liquidity through the EURGCPlus service.
bit.ly/1S5KzUb

Indexes & Products

Legg Mason gets a foothold in campaign to re-engineer ETFs
BY TREVOR HUNNICUTT – Reuters
Legg Mason Inc said on Friday it bought a stake in a company re-engineering exchange-traded funds in the hope of improving the performance of the popular investment products.
goo.gl/I8U1aF

Emerging Market ETFs Lose More Than $1 Billion Led by China Flow
Bloomberg Business
Investors pulled more than $1 billion out of U.S. exchange-traded funds that invest in emerging-markets as a third week of outflows left the ETFs down $3.9 billion this month. Redemptions from emerging-market ETFs that invest across developing nations as well as those that target specific countries totaled $1.17 billion in the week ended Jan. 22, according to data compiled by Bloomberg.
bloom.bg/1S5L6FM

Index breakouts of real estate securities called good news for investors
Pensions & Investments
The decision by two major stock index providers to break out real estate securities into a separate sector could, in the long term, benefit investors by dampening real estate stock volatility and pushing up valuations. Real estate now is lumped in with financial companies such as banks and insurance companies in the Global Industry Classification Standard, which forms the basis of S&P Dow Jones Indices and MSCI Inc. stock indexes.
bit.ly/1S5Lcgp

S&P launches long-term sustainability index
Financial Standard
S&P Dow Jones Indices has launched the S&P Long-Term Value Creation (LTVC) Global Index, aimed at tracking companies with the potential to create “long-term value”. Developed jointly with the Canada Pension Plan Investment Board, the LTVC index measures sustainability criteria and projected investment outcomes over a long-term horizon.
bit.ly/1S5LeVA

Rieger Report: Factors impacting bond liquidity
S&P Dow Jones Indices
Issuer name recognition and entity size seem to be factors in bond liquidity and as a result may be important considerations in index design. Tracking the trade activity of corporate bonds issued by the ‘blue chip’ companies of the S&P 500 Index indicates liquidity is improved for these bonds over other bond issues. Of course, when making decisions about depth of liquidity there are some important elements of the markets to consider
bit.ly/1S5Lkwy

Technology

How Goldman Sachs persuades top tech talent to work there instead of at Google
Portia Crowe – Business Insider
For aspiring investment bankers, Goldman Sachs is a dream place to work.
goo.gl/gVZCrG

Hedge funds told to improve cyber defences
Chris Flood – FT
Hedge fund managers have been urged to bolster their defences against cyber attacks after the Securities and Exchange Commission this month highlighted cyber security as a priority issue for US regulators in 2016.
goo.gl/tbyv9L

Storage of Records of Background Checks Shifted After Last Year’s Security Breach
By JULIE HIRSCHFELD DAVIS – NY times
The Obama administration on Friday said that the Defense Department would take over the storage of records from federal background checks, part of an overhaul prompted by a colossal cybersecurity breach at the Office of Personnel Management.
goo.gl/I3toQP

Top Twitter executives to leave company, CEO Dorsey tweets
BY YASMEEN ABUTALEB – Reuters
Four senior Twitter executives are leaving the media company, CEO Jack Dorsey tweeted late Sunday night, the biggest leadership changes since Dorsey returned as chief executive as he struggles to revive the company’s growth.
goo.gl/Rw1gio

Enforcement

Six Banks Negotiating Settlement in Swiss Libor Probe
Hugo Miller, Gavin Finch – Bloomberg
Swiss regulator: `We won’t go for a settlement at any price’; Settlement would resolve one of few remaining Libor probes
At least six banks targeted in Switzerland’s investigation into Libor-rigging are in settlement talks with the country’s competition regulator, according to two people familiar with the negotiations, as the four-year probe moves closer to wrapping up.
goo.gl/mdJ9Nz

Hong Kong’s Securities And Futures Commission Bans Liu Hsiang-Wen For Eight Months
Mondovisione
The Securities and Futures Commission (SFC) has banned Ms Liu Hsiang-wen from re-entering the industry for eight months from 19 January 2016 to 18 September 2016 (Note 1).
goo.gl/pz5ZJ0

ZhongHuanYun Holdings Group Limited pays penalty for alleged continuous disclosure breach
ASIC
ZhongHuanYun Holdings Group (ZHY), a company listed on the Sydney Stock Exchange (formerly Asia Pacific Stock Exchange), has paid a penalty of $33,000 after ASIC served an infringement notice on the company for allegedly failing to comply with its continuous disclosure obligations.
goo.gl/LrhVmj

Australia Samly Holdings Limited pays penalty for alleged continuous disclosure breach
ASIC
Australia Samly Holdings Limited (Samly), a company listed on the Sydney Stock Exchange (formerly Asia Pacific Stock Exchange), has paid a penalty of $33,000 after ASIC served an infringement notice on the company for allegedly failing to comply with its continuous disclosure obligations.
goo.gl/Ew6GVy

Environmental & Energy

Justin Trudeau Tells Leo DiCaprio To Tone It Down On Climate Change
By Doug Peters – Huffington Post
Canadian Prime Minister Justin Trudeau urged Leonardo DiCaprio to tone down his “inflammatory rhetoric” on climate change saying it was not helping those who have lost their oil-industry jobs.
huff.to/1Ptbdpe

In Canada, the 8-Dollar Cauliflower Shows the Pain of Falling Oil Prices
By IAN AUSTEN – WSJ
Steamed, sautéed or stir-fried, cauliflower is standard fare on many dinner tables. In Canada, it is a luxury. A head of cauliflower there now goes for around 8 Canadian dollars, a tripling in price, the strange foodie fallout from the low price of oil and other commodities.
goo.gl/F4jHPj

OPEC secretary: The glut wasn’t our fault
Reuters
OPEC and non-OPEC oil producers need to work together to tackle a global stocks overhang so oil prices can recover and investments in new fields begin, OPEC Secretary-General Abdullah al-Badri said on Monday.
goo.gl/rxsykf

China Pledges Steel, Coal Capacity Cuts in Supply-Side Reforms
Bloomberg News
China is targeting further cuts in crude steel production capacity by as much as 150 million tons and “large scale” reductions in coal output as part of supply-side measures aimed at curbing overcapacity and excess labor in state-owned industries.
bloom.bg/1PMt6tl

Asia-Pacific

Crashing Commodities Are Saving China $460 Billion a Year
Bloomberg News
Manufacturers’ profit margins helped by lower input costs; Consumers gain from lower heating oil, gasoline prices
The pain from the rout in global commodity prices is sweeping through nations from Brazil to South Africa. The biggest beneficiary? Arguably it’s China, the nation often blamed for driving prices lower due to its slowing economic growth.
goo.gl/RcZzeu

China Can’t Paper Over Yuan-Policy Contradictions; So long as the economic cycles of the U.S. and China are out of sync, Beijing’s dilemma will remain
By AARON BACK – WSJ
The People’s Bank of China is trying to ease monetary policy without causing further depreciation pressure on the yuan. So long as China is even somewhat open to international capital flows, this is like trying to take a shower without getting wet.
goo.gl/RQQDXV

Global Banks Push to Manage Asians’ Rising Wealth; Firms hire more private bankers, seek to show clients advice is needed in turbulent markets; handing out perks
By JULIE STEINBERG – WSJ
Amid slumping Asian markets and a dimmer outlook for deals this year, bankers in Asia are going back to basics: managing money for wealthy clients.
goo.gl/CdhGKJ

Frontier Markets

NSE asks companies to file corporate governance, results online; Bourse asks companies to submit filings through the NSE Electronic Application Processing System
Business Standard
The National Stock Exchange has informed listed companies that it will not accept physical documents related to corporate governance, shareholding pattern, financial results and annual reports, from January 29.
goo.gl/Mui28T

Kenyans are calling on the US attorney general to help unravel a billion-dollar Eurobond scandal
Lily Kuo – Quartz
Kenyans are calling on US attorney general Loretta Lynch to help solve the mystery of almost $1 billion that is allegedly missing from the country’s debut on the international bond market.
goo.gl/UytNyI

‘Pakistan to receive up to $500 million post MSCI re-classification’
The Express Tribune
Pakistan is expected to receive an inflow of up to $500 million in foreign portfolio investment should the MSCI reclassify it as an emerging market in its upcoming annual review in May, says Next Capital CEO Najam Ali.
bit.ly/1S5L14P

Miscellaneous

Sexism in banking? It’s happening, and it’s complicated
The Guardian
It’s possible to have an individually engaging career in banking while still being the general loser to structural sexism, but there are bigger questions to answer
A couple of years ago I took a call at work from a journalist asking whether I would talk to him for a story he was writing for his Sunday newspaper on sexism in the City. Had I, he wondered, ever experienced sexism in the City?
goo.gl/LZpGIq

De Beers looks to bring clarity to diamond market
James Wilson, Mining Correspondent – FT
De Beers is to break with decades of secrecy over the state of the diamond trade as it prepares to divulge details of sales for the first time.
goo.gl/kfUzhN

Ex-Banker Creates Gambling Startup That Wins Over Danish State
Frances Schwartzkopff – Bloomberg
Ex-Saxo banker sets up firm that offers pool-betting on stocks; Denmark’s government-run gambling agency mulls collaboration
A former gaming analyst from Denmark has started what he says is the world’s first online gambling site for betting on share movements. And the government is keen to jump into the venture as stock-market watching goes mainstream.
goo.gl/BGmnta

Dream of being your own boss? Join the sole traders; There are 3.3 million sole traders in the UK, accounting for more than 60% of all private business. We look at the pros and cons of becoming one
Mark Smith, The Guardian
Chasing invoices, juggling family life and dealing with clients who expect the world for a pittance – all these are part of the daily grind for a sole trader.
goo.gl/dzTE7R

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