Aston Capital Management is now a provisionally registered US Swap Dealer.
The National Futures Association (NFA) notified the firm and updated its website to reflect this news on April 2.
According to the NFA website: “A swap dealer (SD) is an entity that holds itself out as a dealer in swaps; makes a market in swaps; regularly enters into swaps with counterparties as an ordinary course of business for its own account; or engages in any activity causing the entity to be commonly known in the trade as a dealer or market maker in swaps.”
Firms can be exempted from the SD registration if the aggregate gross notional amount of the swaps that they enter into over a 12-month period in connection with dealing activities is less than $8 billion.
In a recent interview with Profit & Loss, Isaac Lieberman, CEO of Aston, highlighted a number of reasons why the firm receiving this SD registration is important for its future growth plans.
Firstly, it expands the number of products that the hedge fund it is able to trade, allowing the firm to move into the FX forwards, swaps, NDF and options markets.
Secondly, it is important for building out the firm’s execution services desk, which will offer end-users access to the firm’s technology, quantitative research and neural networks.
And thirdly, Lieberman points out that the SD registration puts his firm in the same regulatory bracket as many major banks and other large financial institutions. He claims that this should induce confidence amongst potential investors in the firm because they will know that the fund is a regulated entity capable of being audited and that has a wide range of documented compliance, operating, risk and disaster recovery procedures in place.