LME looking to improve liquidity

Interested in trading metals? The LME launched a month-long consultation on proposals designed to broaden access to its electronic trading platform. 

According to LME the proposals are crucial to  maximize liquidity and participation. CEO Garry Jones believes that opening up access to trading on LMEselect is beneficial to everyone  active on all LME's venues. 

More flexible application criteria for LME membership may lead to some prospective members benefiting from exemptions from the UK Financial Conduct Authority (FCA).

The effort is an important step in  LME’s liquidity roadmap.

Join Inside ETFs Europe on June 8

From Monday 8 june till Wednesday 10 June a large ETF conference is held at the Okura in Amsterdam.

More than 500 industry professionals will gather to learn more about ETF's and have in-depth discussions on latest trends in the ETF market at the 6th annual Inside ETF's Europe.

We will cover the event at Brokerdealer.eu and summarize the proceedings but do consider joining the event yourself. It looks to be a great event.

The event will kick off on Monday with some ETF basics such as understanding what ETF's are, how to trade them and how to choose the best ETF's for different asset classes. In the afternoon, focus will shift towards Smart Beta ETF's, Fixed Income ETF's, commodity ETF's and currency ETF's. The session is closed with a keynote adress by Professor Jeremy Siegel providing his outlook on Global equity markets and interest rates and a coctail drink session.

On Tuesday the session proceeds with keynote addresses on how ETF's are changing the investment world, a macro economic discussion on finding investment opportunities and the future of ETF's. During the lunch a Q&A session with Dutch football legend Ruud Gullit is held. In the afternoon 6 'track-sessions' will be held with panels consisting of different industry professionals detailing the usage of ETF's for different markets and purposes. After the closing keynote of former White House advisor Pippa Malmgren, a reception is held at the famous van Gogh Museum.

On Wednesday, the conference is closed with a recap, a panel discussion on platforms and Smart Beta, a live trading demonstration on finding liquidity and regulation topics. The final word for the conference is given to Nick Leeson, perhaps one of the most famous 'trader turned big house resident' ever. Leeson now gives speeches on risk and corporate responsibilty using his vast practical experience in that area.

All in all a very worth-while conference to learn about one of the fastest growing sections of our industry and a great place to meet interesting industry peers.

Check out the conference website for more information and registration.

NYSE to launch bitcoin index

The NYSE today announced the NYSE Bitcoin Index (NYXBT), the first exchange-calculated and disseminated bitcoin index. 

NYXBT will utilize a unique methodology relying on rules-based logic to analyze a dataset of matched transactions and verify the integrity of the data to produce an objective and fair daily value for one bitcoin in USD.

The NYSE Bitcoin Index will initially feature data from transactions from Coinbase Exchange, the leading U.S.-based bitcoin exchange in which the NYSE has a minority investment.

Read the full press release here.

Tullet Prebon launches matching engine for alternative investments

Tullet Prebon is one of the largest interdealer broker worldwide. It has now launched a matching engine for alternative investments called TP-AIME. The enigine will also serve as an auction facility for secondary investments in hedge funds, private equity and real estate funds.

The matching engine is the first of its kind and Tullet Prebon believes it will increase transparency and simplify transactions in a relatively opaque market.

Users of the plaform will be 'LP's' (Limited Partners) such as the funds to buy or sell illiquid interests and 'GP's' (General Partners) such as private equity firms looking to run auction events.

Read the full press release here

Tradetech Paris

Last week the wise men of the financial world gathered in Paris to discuss the future of the equity markets in the Tradetech conference. A very good blog was written by Tim Cave summarizing the key takeways from the conference. So, for all that were not there, catch up by reading this article.

Is Bitcoin the Myspace of currency?

Being first to market, is not all what it's cracked up to be. Yahoo search was out there way before Google, Myspace explored senseless blabber way before Facebook and Blackberry was making phones smart before other made them even smarter and more functional.

 Found an interesting slideshow from a tech angel investor underlining this point:

First mover disadvantage from Eric Tachibana

In that perspective it is interesting to look at Bitcoin. Hyped, feared, misunderstood and abused but all in all, a potential game changer. 

Question though is, will it change the game and become  the world's new currency, or will it simply pave the way for a model that is better. David Mazieres, a Stanford professor definetely seems to think so. He has developed a new digital currency that relies less on 'mining', is more secure and processes the transactions faster. Read the full article (also a link to the white paper) here .

OTC trading is sometimes better!

The OCC is reporting a drop in on exchange trading in options on the US markets. At the same time OTC volumes are up! This is certainly strange in view of the increased emphasis on counterparty risk.

However, it looks like other factors are at play. High exchange fees, ease of execution and fear of being picked of by HFT seem to be the main drivers behind the shift in volume. Some arguments do make sense. Having your order executed in 20 tiny exchange trade is not always that convenient.

CBOE seems to be in the centre of the discussion as the have a monopoly on some of the listed derivatives.

Read the full article here (Reuters). The OCC report can be found here.

Euronext to launch dairy derivatives

Euronext is set to expand their commodities offering by launching dairy derivatives in milk, butter and whey. As of 31 March, the milk quotas are no longer in force in the EU and the exchange expects demand from users to hedge their risks and anticipate price movements. The dairy complex (futures only) is set to go live on 13 April 2015. No word yet on when options will be launched. The new contract on skimmed powdered milk replaces the old contract that failed to take off.  The new dairy complex competes with the offering by competitor Eurex that offers futures on whey, butter and powdered skimmed milk.

 Euronext instituted fee waivers for all three contracts untill 30 June 2015. 

The full Euronext commodities offering can be found here. 

Flash vs Flash

The IB times reported a law suit today of Chicago HFT firm HTG Capital Partners. They are sueing another HFT firm for 'spoofing' activities in T-Bonds.

The most interesting thing is that consensus among HFT firms is that 'spoofing' does not happen. The name of the other HFT firm is not mentioned.

read the full article here

Does HFT have a future?

If you're a fan of American tv-series, you will know that the US Patriot Act is often used as a sort of 'enabler' to get things done, bypassing the usual rules.

According to Craig Pirrong, professor at the University of Houston, the same thing could apply to the DoddFrank act and HFT. He feels that, regardless of actual argumentation or merits, the Act can be used to kill off HFT, just because HFT is of inconvenience to some.

Click here for his article and blog.

PWC study outlines growth and opportunities in the ETF market

No need to argue the growth that ETF's have made over the last years. According to a study from PWC, this growth will continue. PWC outline the opportunities for asset managers in this ever growing segment. The full article can be found in our studies section. Click on  the ETF section