First Read

Veronica Augustsson, CEO, Cinnober – The Why & How of Technology

“If you don’t know the technology, you don’t really know what you can achieve. It’s when you combine the business knowledge and the technology that you achieve something special.”

Veronica Augustsson, CEO of Cinnober, discusses the importance of tying together technical and business knowledge. Augustsson says that as a developer, one must not be easily discouraged when others tell them their ideas seem impossible. Knowing the capabilities of your technology will help generate new solutions to existing problems. Augustsson also touches on the importance of curiosity and why we should be driven by our curiosity to innovate and improve existing technologies. She says that finding an environment that helps inspire and drive your curiosity is essential.
Watch the video »


Banks Fined Over Pursuit of Work on Toys ‘R’ Us IPO
By Telis Demos And Alexandra Scaggs, WSJ
Finra Says 10 Wall Street Banks Offered Favorable Coverage to Secure Spot as Underwriters
Citigroup Inc., Goldman Sachs Group Inc. and eight other securities firms were fined a total of $43.5 million by regulators who said the companies offered favorable stock research in hopes of winning underwriting business in an initial public offering by Toys “R” Us Inc.

***** Now there is a Christmas gift!


A New Guide to Trading on Inside Tips Without Prison Time
By David Glovin and Patricia Hurtado, Bloomberg
A casual tip on the back nine seems safe. A hot steer from someone who knows someone might be iffy. And a profitable, you-scratch-mine-I’ll-scratch-yours exchange is — well, get a lawyer. After the biggest insider-trading crackdown since the days of Ivan Boesky, Wall Street is getting more wiggle room, not less, to trade on confidential information.

**** First rule of insider trading. Get your tips outside.


Eurex colleagues participate in Movember fundraising campaign
Movember, a combination of the words moustache and November, is a fundraising campaign originating in Australia. Every year, as a symbol of the campaign comparable to the red ribbon for HIV awareness, men grow a beard during the month November and collect donations that go into the research and prevention of typical male diseases. Headed by Cameron Teague, colleagues from the London office contributed six impressive beards and £720!

***** They raised just a hair over £700.


Pipelines: Nick Solinger talks market infrastructure for SEFs

It’s been a historic year for swap execution facilities as more were launched in the wake of Dodd-Frank rulemaking by the Commodity Futures Trading Commission.

Nick Solinger, head of product strategy and chief marketing officer of Traiana, said that its been a good year for firms getting connected to SEFs and for SEFs getting off the ground. The firm connected 16 FCMs to 16 SEFs with six more on the way.

“The typical FCM has been able to clear, three, four, five, six different venues with that one connection to our hub,” Solinger said. “Buy-side firms can similarly trade across multiple SEFs with one-credit line. So we really have realized that initial vision we had as an industry.”

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Don’t Fear Twitter, Bankers Told Over Tea and Hashtags
By Kit Chellel, Bloomberg
Tweeting bankers can wreak havoc in 140 characters. They can also use Twitter to help restore trust in financial services, according to Kitty Parry, founder of the Social Media Charter.
At a seminar in a conference room at the U.K. Houses of Parliament yesterday, Parry pushed the benefits of Facebook posts and tweets as bankers were served scones with jam and clotted cream on silver plates.

***** I would believe anything Kitty Parry told me. Kitty Parry is Jim Kharouf’s favorite singer.


The App That Wants to Bring Financial Markets to Millennials
Institutional Investor
Institutional finance, for the most part, has done a pretty poor job of catering to millennials. Investment, especially via the public markets, is still seen as the province of “old people.”

***** This is an app that can get you a date and let you trade stocks paid for with bitcoins.


Time to go FragPro?
Get a sneak preview of the new version of Fragulator which goes on general release next week

***DA: There is a special prize for anyone who wears a GoPro while viewing FragPro.


FIA Merges Chicago and Futures Services Divisions
In early 2014, the boards of FIA Chicago and FIA Futures Services began plans to merge both divisions in 2015. In November, the leadership of both boards submitted a proposal for the merged division to the FIA parent board. The new set of by-laws was approved, and it was agreed that on January 1, 2015, FIA Chicago and FIA Futures Services would merge to become the FIA Operations Americas Division.
(via email)
***DA: If you are a member of one or both divisions, would like to join, or have questions, contact Mary Freeman at


FOW Awards Summary
Our friends at FOW held their annual awards gala this week – you may have noticed the press releases sprinkled through the newsletter the past few days. FOW publisher Will Mitting has asked us to share this summary page featuring all the categories and winners.

***DA: For next year, I suggest a new award – Best Financial Media Firm That Does Not Have its Own Award Show. John Lothian News would win, as we would be the only nominee.

***JK: For the three companies that did not win an award this year, there’s always next year.


Brendan Bradley, chief innovation officer, Eurex – The New World of Finance

“We are the wheels of industry. Y
ou wouldn’t actually have the rest of these businesses operating if it wasn’t for the fact that the finance world still greases all of the wheels making all these businesses come around.”

Brendan Bradley, chief innovation officer of Eurex, compares the financial world to the tech industry, and discusses the connection between companies like Google and Goldman Sachs. Bradley says that while the appeal for young people to work for a financial organization may not seem as high as working for a tech firm, it is actually the financial industry that helps tie other industries together. Bradley also discusses market structure, mention how OTC is generally seen as being negative while CCP is seen as being positive. Finally, Bradley concludes with the future of market infrastructure, comparing Bitcoin to T2S, as well as discussing the possibility of more crypto-currencies appearing in the future.

Watch the video »



MarketsWiki Page of the Day

MarketsWiki Recent Updates


David Escoffier; John Fennell; Michael McClain; Nicholas Garrow; Jeremie Bacon; Jessica Titlebaum; Troels Philip Jensen; Per E. Larsson

Companies, Organizations and Groups

Eurex; Orc Group


56,085,517 pages viewed, 8,108 articles, 187,498 edits
MarketsWiki Statistics

Lead Stories

Wall Street’s Win on Swaps Rule Shows Resurgence in Washington
By Cheyenne Hopkins and Silla Brush, Bloomberg
Wall Street is re-emerging as a force in Washington as it closes in on one of its biggest wins against regulation since the financial crisis.

***DA: We will be keeping an eye on this one as it moves through the process. For a refresher on the pushout rule (aka the Lincoln Amendment), visit the page in MarketsReformWiki

MF Global’s underwriters to settle suit for $74 mln
Seven underwriters of the failed MF Global Holdings Ltd reached a partial settlement with investors, who had filed a lawsuit in 2011 seeking to hold them and some of the brokerage’s executives, including its CEO, responsible for its collapse.

SEC Details Plan to Target Risks at Asset Managers; Mutual-Fund Firms Face Stress Tests, Curbs on Use of Derivatives
By Andrew Ackerman – Wall Street Journal
The Securities and Exchange Commission unveiled a sweeping set of initiatives Thursday to cut risk in the $60 trillion asset-management industry.

U.S. authorities face new fallout from insider trading ruling
By Nate Raymond and Aruna Viswanatha, Reuters
U.S. prosecutors, already smarting from a appeals court ruling that weakens their ability to crack down on future insider trading, on Thursday faced widening fallout from the decision as some existing cases threatened to unravel.

Heather Capital: How a $600 Million Hedge Fund Disappeared
By Laurence Fletcher, WSJ
Gregory King’s Fund Pulled in Money From Big-Name Investors, But Liquidators Have Found Little
In the run-up to the financial crisis a hedge fund took in hundreds of millions of dollars from wealthy investors. Now the money is gone—and the man who ran it has disappeared from their sights.

CFTC Chairman: We Have Oversight of Bitcoin Derivatives
Joon Ian Wong, CoinDesk
The chairman of the US derivatives regulator has told a senate committee that digital currency derivatives fall within his agency’s remit.

FTT set to miss 2016 deadline
Securities Lending Times
Ministers from the EU 11 have failed to meet their end-of-year deadline for outlining the Financial Transaction Tax (FTT) on equities, which is likely to scupper January 2016 implementation plans, according to reports. The EU 11 had originally intended to come to a conclusion over the FTT before the end of 2014.
But almost two years of talks have not produced a result in time, suggesting that the 2016 implementation deadline might be missed. French finance minister Michel Sapin has reportedly claimed that an agreement on the final FTT is still possible.

London Stock Exchange connects EuroCCP to main market
by Elliott Holley, Banking Technology
The London Stock Exchange has set out plans to add European Central Counterparty as a third CCP for its main market from March 2015.

Societe Generale Appoints Nick Gionfriddo As Head of OTC Clearing Sales, North America
Press release
Societe Generale Corporate & Investment Banking (SG CIB) today announced the appointment of Nick Gionfriddo as Head of OTC Clearing Sales, North America within its Newedge prime services business. Mr. Gionfriddo will be based in New York and will work closely with Jamie Gavin, who was recently appointed Head of Institutional OTC Clearing Sales, UK. He will report to Adam Cohen, Global Head of Institutional Sales.

ICAP Said to Be in Talks With ADM to Transfer LME Trading
By Agnieszka de Sousa, Bloomberg
ICAP Plc (IAP) is in talks to transfer its trading business on the London Metal Exchange to ADM Investor Services International Ltd., according to two people familiar with the matter.

FINRA Fines 10 Firms a Total of $43.5 Million for Allowing Equity Research Analysts to Solicit Investment Banking Business and for Offering Favorable Research Coverage in Connection With Toys”R”Us IPO
WASHINGTON — The Financial Industry Regulatory Authority (FINRA) announced today that it has fined 10 firms a total of $43.5 million for allowing their equity research analysts to solicit investment banking business and for offering favorable research coverage in connection with the 2010 planned initial public offering of Toys”R”Us.

U.S. lobbyists predict more Dodd-Frank changes, not overhaul, in 2015
By Emily Stephenson, Reuters
U.S. financial industry victories this week walking back post-crisis reforms will embolden Republicans in 2015 to push for more changes, but lobbyists say they are not holding out hope for a substantial rollback of the 2010 Dodd-Frank reform law.

Is Investor Attention for Sale? The Role of Advertising in Financial Markets

The Height of Absurdity: The Operation of the Government Hinges on Blanche Lincoln’s Brainchild
The Streetwise Professor
There’s a whole lotta stupid in Frankendodd. A whole lot. The SEF Mandate is at the top of the list, but the “Swaps Pushout” isn’t far behind. The Pushout was the brainchild of ex-Arkansas Senator Blanche Lincoln. (NB: I understand the risks of using “brain” in the same sentence as “Blanche Lincoln”.) Blanche, she of the historic 21 point annihilation in the 2010 midterms.

Some Accused of Insider Trading May Rethink Their Guilty Pleas
By Matthew Goldstein and Ben Protess, NY Times
A ruling that tossed out the insider trading convictions of two hedge fund managers may have opened the door for others charged with wrongful trading to get their cases or pleas dismissed.


SEC chief not pleased over insider trading decision
By Michelle Celarier, NY Post
Securities and Exchange Commission chief Mary Jo White is none too pleased about Wednesday’s landmark federal appeals court ruling that overturned two insider trading convictions.

What’s New on the SEC Website
Enhancing Risk Monitoring and Regulatory Safeguards for the Asset Management Industry by Chair Mary Jo White
BATS: Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Related to Fees for Use of BATS Exchange, Inc. (Release No. 34-73809; File No. SR-BATS-2014-064; December 10, 2014); see also Exhibit 5
DTC: Order Approving Proposed Rule Change in Connection with the Modifications to Require Receiver Authorized Delivery Approval for DTC Processing of Institutional Delivery Transactions (Release No. 34-73804; File No. SR-DTC-2014-10; December 10, 2014)
FICC: Notice of Filing of Proposed Rule Change to Amend the Government Securities Division Rulebook and the Mortgage Backed Securities Clearing Rules In Order to Move the Time of Novation with Respect to Certain Trades, Include Rules to Reflect Existing Processes, and Clarify Certain Rules to Reflect Current Practices (Release No. 34-73805; File No. SR-FICC-2014-11; December 10, 2014)
ISE: Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Make Technical Corrections to ISE Rules (Release No. 34-73808; File No. SR-ISE-2014-54; December 10, 2014); see also Exhibit 5
NASDAQ: Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Modify An Optional Subscriber Fee and Tiered Distribution Fee for “Enhanced” Data Displays (the “Enhanced Display Solution Fee”) (Release No. 34-73807; File No. SR-NASDAQ-2014-117; December 10, 2014)
NYSE Arca: Notice of Designation of a Longer Period for Commission Action on Proposed Rule Change, as Modified by Amendment No. 1 Thereto, to Reflect Changes to the Means of Achieving the Investment Objective Applicable to the Guggenheim Enhanced Short Duration ETF (Release No. 34-73810; File No. SR-NYSEArca-2014-107; December 10, 2014)

SEC Announces Agenda for Meeting of the Advisory Committee on Small and Emerging Companies
The Securities and Exchange Commission today announced the agenda for the December 17 meeting of its Advisory Committee on Small and Emerging Companies.

FCA proposals to tackle issues in GAP insurance market
The Financial Conduct Authority (FCA) is proposing changes to promote competition in the £160 million guaranteed asset protection (GAP) insurance market, including limiting the point of sale advantage for GAP sales made on the vehicle showroom floor and making it easier for consumers to shop around.

ASIC class order clarifies fee and cost disclosure requirements

Canadian Securities Regulators Finalize Requirements for Pre-sale Delivery of the Fund Facts for Mutual Funds
Toronto – The Canadian Securities Administrators (CSA) today published final amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure, which will require all dealers that sell mutual funds to deliver a Fund Facts before investors make a decision to buy a conventional mutual fund. The Fund Facts is a document written in plain language, is no more than two pages double-sided and highlights key information about a mutual fund that CSA research has identified as important to investors.

Exchanges & Trading Facilities

Telekom Austria AG: Resumption of trading of options and futures

CME Group Notices
Performance Bond Requirements: Electricity, ERIS, FX, Interest Rates, NGLs, and Refined Products Outrights; Crude Oil Intra-Commodity Spread Charges; Electricity, Equity Index, FX, and Refined Products Inter-Commodity Spread Credits – December 12, 2014
Implementation of New CBOT Rule Regarding Special Price Fluctuation Limits for Certain CBOT Interest Rate Futures and Options Contracts
Implementation of New NYMEX/COMEX Rule Regarding Special Price Fluctuation Limits for Certain NYMEX and COMEX Metals Futures and Options Contracts
Implementation of New CME Rule Regarding Special Price Fluctuation Limits for CME Foreign Exchange Futures and Options Contracts
CME Clearing Notice: Week of Monday, December 8, 2014
Modification to Daily Settlement Price Determinations in Certain CME Agricultural Futures
Reminder Regarding Giving and Receiving Gratuities

CBOE Awarded U.S Options Exchange of the Year from Futures and Options World for Third Straight Year
The Chicago Board Options Exchange® (CBOE®) has been named “U.S. Options Exchange of the Year” for the third consecutive year at an awards ceremony during Futures and Options World magazine’s Derivatives World London Conference.

CME Gains After $2 Variable Dividend; Sandler Ups Price Target
By Michael Aneiro, Barron’s
Shares of CME Group Inc. (CME) have edged higher Thursday morning after the options and futures exchange declared a $2.00 annual variable dividend late Wednesday, payable Jan. 13, 2015. Sandler O’Neill analysts said the dividend comes in slightly above the high end of their expected range, noting that annualizing the current quarterly cash dividend of $0.47 and then adding the $2.00 variable dividend implies annual dividends of $3.88 per share, equating to a 4.4% yield based on yesterday’s close.

BM&FBovespa extends buyback, boosts 2015 investments
Exchange operator BM&FBovespa SA will extend for another year a plan to repurchase up to 60 million shares, or 3.3 percent of its shares outstanding, it said in a securities filing on Thursday.

CEO of CME hints of more products to come with hybrid qualities
By Renee Caruthers, Fierce Finance IT
CME Group may be weighing the introduction of a hybrid product with some qualities of swaps and some of other exchange-traded derivatives, the company’s chief executive suggested at a conference this week.

Holland Clearing House Receives EMIR Authorisation
Intercontinental Exchange (NYSE:ICE), the leading global network of exchanges and clearing houses, announced today that De Nederlandsche Bank (Dutch Central Bank, DNB) has approved the Holland Clearing House as a central counterparty in accordance with the European Market Infrastructure Regulation (EMIR).

MGEX To Modify AJC Contract Specifications
MGEX, a Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO), is planning to modify its Apple Juice Concentrate (AJC) futures and options contract specifications, pending review from the Commodity Futures Trading Commission (CFTC).

Hedge Funds & Managed Futures

Commodities Firm Gunvor Said to Exit Gold Trading After Year
By Chanyaporn Chanjaroen and Andy Hoffman, Bloomberg
Gunvor Group Ltd. is giving up trading physical precious metals less than a year after the commodity house started a business dedicated to buying and selling gold.

This Hedge Fund’s Machines Are Making the Right Calls on Oil
By Kelly Bit, Bloomberg
Hedge funds that rely on computer programs to trade are producing some of the highest returns in the industry after a particularly profitable November. Two Sigma, a $24 billion firm run by a former artificial intelligence academic and a mathematics olympian, rose 10 percent last month in one of its strategies and is up 47 percent this year.

Banks & Brokers

ADM chooses Kentucky for tech center
By Alejandra Cancino, Chicago Tribune
A year after Archer Daniels Midland lost a bid to keep $30 million that its employees would pay in taxes to Illinois, the agricultural giant said Thursday it will locate its coveted technology and support center in Kentucky.

Javelin secures SEF lifeline as CFTC targets anonymity
International Financing Review
One of a handful of smaller fish in the newly created swap execution facility pond has secured a commitment for longer-term funding – just prior to a possible change to CFTC rules that could finally spark the movement of over-the-counter swaps into an exchange-like format.

Clearing & Settlement

638.8 billion average outstanding for Clearstream
Securities Lending Times
Clearstream has reported a boost in its global securities financing (GSF) services, with monthly average outstanding reaching 638.6 billion in November 2014.

London Stock Exchange to add additional CCP to SETS and SETSqx order books
London Stock Exchange today announces that it will add European Central Counterparty N.V (EuroCCP) as a provider of CCP services to its SETS and SETSqx order books. The move, which is subject to regulatory approval, is expected to take place in March 2015. EuroCCP will become the third provider of clearing services alongside LCH.Clearnet Ltd and SIX X-Clear.

Indexes & Products

IBA to Suspend ISDAFIX Swiss Franc (CHF) Rate
Intercontinental Exchange (NYSE: ICE), the leading global network of exchanges and clearing houses, today announced that due to the resignation of one of the submitting banks, ICE Benchmark Administration (IBA) will suspend the ISDAFIX Swiss franc (CHF) from its portfolio of benchmarks. The last rate will be published on Friday 19 December, 2014. The CHF represents the smallest currency rate of the ISDAFIX portfolio.

Xetra/Börse Frankfurt: New Source ETF Launched In XTF Segment On Xetra – ETF Offers Currency-Hedged Access To The S&P 500
A new equity index ETF issued by Source has been tradable in the XTF segment on Xetra since Friday.

Russell Indexes launches new report on smart beta implementation
This new report offers additional insights on smart beta implementation strategies and further demonstrates asset owners’ growing interest in and adoption of smart beta strategies and how they can best fit within investment portfolios.


Microsoft to Allow Bitcoin Payments for Games, Apps, Other Content
The world’s second-largest company has given the biggest corporate endorsement yet to the digital currency, bitcoin.

Google shuts Russia engineering office
Richard Waters in San Francisco, FT
Google is to close its engineering office in Russia, in the latest sign that a crackdown on internet activity by Russian authorities this year could hasten an outflow of engineering talent from the country.


Commerzbank Likely to Pay More than $1 Billion to Settle Probes; Germany’s Second-Largest Lender Under Investigation for Violating U.S. Economic Sanctions
By Christopher M. Matthews and Justin Baer
German lender Commerzbank AG is likely to pay more than $1 billion to U.S. authorities to resolve two probes examining whether it violated U.S. economic sanctions and money laundering laws, according to people familiar with the matter.

Finra fines 10 Wall Street firms over IPO pitches
Crain’s New York Business
Goldman Sachs Group Inc., Citigroup Inc. and JPMorgan Chase & Co. were among the banks fined a total of $43.5 million.

Environmental & Energy

Australia’s Emissions Forecast to Surge Under Abbott’s Policies
By James Paton, Bloomberg
Australia’s carbon emissions are forecast to rise significantly by the end of the decade with Prime Minister Tony Abbott’s climate policies, while the U.S. and China take steps to curb greenhouse gas pollution.

California Would Need Five More Super Storms to Quell Drought
By Esme E. Deprez and Alison Vekshin, Bloomberg
A slow-moving storm causing flooding and power outages in northern California would need to be replicated at least five more times for meteorologists to declare an end to the state’s historic drought.


HKEx Completes Rollout of Orion Market Data Platform with Derivatives Launch
Hong Kong Exchanges and Clearing Limited (HKEx) completed the rollout of its HKEx Orion Market Data Platform (OMD) on 1 December 2014 with OMD’s extension to support the derivatives market at HKEx.

Frontier Markets

The Economist looks to China and India for new readers
Henry Mance and Robert Cookson, FT
“Broaden Your Horizons”, is the tagline of The Economist’s latest adverts, and the magazine’s editor seems to have taken it to heart. John Micklethwait will leave next month after eight years in charge, to head the editorial operations of Bloomberg News.

Securities and Exchange Board of India Releases
Release of bank and demat accounts – Galaxy Broking Ltd.
Adjudication Order in respect of Electronica Machine Tools Ltd. in the matter of non redressal of investor grievance
Amsons Apparels Limited
ICICI Prudential Multiple Yield Fund – Series 9 Plan A to L
PR – Order in the matter of M/s Kalpbut Real Estate Limited and its Directors
Tata Dual Advantage Fund Series 3(Scheme A to C)

FTIL continues to hold 10,000 shares of NSE
Live Mint
Though value of shares isn’t substantial, the stakeholding gives FTIL access?to?NSE’s?strategic and corporate decisions


The man who mends careers and hearts
Emma Jacobs, FT
Manj Weerasekera had an itch of an idea that would not go away. The executive coach kept meeting senior businessmen who in the course of their work-focused meetings would reveal that they were having relationship problems at home. It was only after entrusting career problems to him that they felt comfortable enough to discuss their personal lives.

Celebrity chef Michel Roux Jr turns the tables by combining FX, food and charity
By Andrew Saks-McLeod, LeapRate
“There are certain items on the restaurant menu which are a high sell, but will bring little return. It is all about percentages and balancing the menu correctly so that at the end of the trading day, we have a good profit.” – Michel Roux Jr, Owner, Le Gavroche, London

Egg Market Disrupted in U.S. as Cages Made Roomier: Commodities
By Shruti Date Singh and Lydia Mulvany, Bloomberg
Eggs are about to get more expensive, as California moves to make sure hen houses are roomy enough to allow the birds to lay down, stand up, extend their wings and dance around.

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