Month: May 2018

Hall of Fame 2018

Steve Flanagan
Global FX e-Commerce Risk Manager, JP Morgan
“Work Ethic and Vision”

Stephen Flanagan’s career should be held up as the textbook example of the successful evolution of FX. Having come to banking in 1979 – he celebrates 40 years with JP Morgan next year (certainly one of the most tenured individuals in the bank we’re told) – his career evolved from the traditional, spot voice trader, to taking a lead role in the development of electronic trading at one of the industry’s premier FX firms.

XTX Establishes e-Trading Facility in Singapore

Trading firm XTX Markets’’ Singapore entity is building a new FX pricing and trading engine which will go live in Equinix’s Singapore SG1 data centre in June 2018.
XTX says it believes that the SG1 build-out will enhance the e-FX trading experience for XTX’s counterparties in the region and in turn, help increase participation rates and volumes for e-FX activity conducted within Singapore to benefit the regional FX market ecosystem.
“Under the Financial Services industry transformation map (ITM) introduced in October 2017, MAS aims to enhance the e-FX trading infrastructure to improve market transparency and facilitate price discovery of FX trading in the Asian time zone,” says Alan Yeo, executive director, Monetary Authority of Singapore (MAS).

Mosaic Adds Two

FICC data analytics company Mosaic Smart Data has added two finance and technology experts to its executive team.
Stephen Caplen joins as chief financial officer (CFO) and John Showell becomes the company’s new chief operating officer (COO).
Caplen was most recently deputy group CFO at interdealer broker Icap and has also held posts as CFO at EBS and deputy head of finance at the London Stock Exchange.
Showell, meanwhile, was last at ION Trading, where he was client services director.

And Another Thing…

I do tend to give press releases about crypto the most perfunctory of glances – often because it’s yet another firm claiming to be taking a new and innovative approach when it is nothing of the sort. So when I saw the headline, “Crypto Prices Driven Purely By Mood of Investors” I gave the press release a minute or two fully expecting to bin it. I didn’t, because firstly market psychology fascinates me (I know – I need to get out more) but also because the findings of the research stressed both the challenges and opportunities afforded by crytpocurrencies.

MarketFactory Releases Pre-Trade Risk Solution

MarketFactory has released its new software product, Reflector, a pre-trade risk management service for banks, prime brokers and funds to help ensure trading limits are never broken.

The firm says that Reflector addresses the need for risk management software that eliminates installation for the client, works with any FIX API, and monitors and balances all limits and positions across all trading venues. Additionally, it checks all orders pre-trade with a latency impact under three microseconds 99.999% of the time and supports over 60 trading venues.

“Runaway algorithms or simply breaking a limit remain a major risk in an increasingly complex market,” says James Sinclair, executive chairman of MarketFactory. “We are very excited to see the positive impact that Reflector has for our customers. This includes both ensuring limits will be not be breached and allowing more efficient use of available credit.”

Could the Shift to Clearing Alter FX Market Structure?

Although there are clear drivers pushing more FX products into central clearing, this is unlikely to have a significant impact on market structure, says Paddy Boyle, the head of ForexClear, LCH.

“The pressure to clear for banks that are subject to bilateral initial margin rules is very, very high and we have banks who tell us they’ve been cut off by other banks because they weren’t clearing,” he says.

That, explains Boyle, is one of the negative drivers towards central clearing, while on the positive side there are lower capital costs, lower initial margin requirements and fewer credit line restrictions for firms that choose to use clearing services. As a result, Boyle predicts that cleared FX volumes will increase “pretty significantly” going forward.

Capitolis Launches FX Novation Service

Capitolis, the technology company founded by ex-Icap (now NEX Group) executive Gil Mandelzis, ex-Thomson Reuters CEO Tom Glocer and Igor Teleshevksy, formerly of Traiana, has launched a novation service in FX.
The firm says that Citi, HSBC, BlueCrest and Brevan Howard, among many other market participants, have collaborated with the firm on the service, which it adds is the first of its kind in FX.
Capitolis Novation automates the currently manual workflow in both FX prime broking and bilateral trading, thus providing capital efficiencies for the FX market.

Record Handed AUD350m Mandate

Record Currency Management has been awarded an AUD350 million mandate by Sunsuper, an Australian superannuation fund.

The mandate is an active currency portfolio, the objective of which is to generate risk-adjusted returns using Record’s Currency Multi-Strategy product, a factor-based return-seeking currency investment strategy.

The mandate size was approximately AUD350 million at mandate inception, as referred to in Record’s fourth quarter trading update on 20 April 2018, when the mandate was funded.

While currency hedging focuses on risk mitigation, Record’s active currency strategies allocate across currency risk premia and are return-seeking in nature, designed to capture the main drivers of return in currency markets.

Hall of Fame 2018

The Profit & Loss Hall of Fame 2018
Steve Flanagan, Global FX e-Commerce Risk Manager, JP Morgan
“Work Ethic and Vision”

Stephen Flanagan’s career should be held up as the textbook example of the successful evolution of FX. Having come to banking in 1979 – he celebrates 40 years with JP Morgan next year (certainly one of the most tenured individuals in the bank we’re told) – his career evolved from the traditional, spot voice trader, to taking a lead role in the development of electronic trading at one of the industry’s premier FX firms.

Banerjee Wins Unfair Dismissal Claim

Profit & Loss understands that John Bannerjee, who claimed unfair dismissal against former employer Royal Bank of Canada, has won his case.
Sources say that the tribunal judge at the London Central Tribunal found that the principal reason for his dismissal was the making of a protected disclosure. The judge also found, the sources say, that Bannerjee contributed 25% to his dismissal, however the compensation awarded will be boosted by 25% because the bank failed to comply with the UK’s Advisory, Conciliation and Arbitration Service (ACAS) Code of Practice.