Tag: Equities

Equities

Barclays Migrates Equities to BARX

Barclays has added equities to BARX and announced that it will now function as the bank’s cross-asset electronic trading platform. Prior to this, clients could trade FX, fixed income and futures on the BARX platform. “We are excited to announce that BARX will be our newly integrated, cross-asset electronic trading platform that will continually innovate […]

Data Remains the Key Battleground for FX Platforms

Platform providers are becoming more conscious about the value of data, both for their businesses and their clients. Galen Stops takes a look at what this means for the FX industry.I f there is one consistent trend that emerges talking to all of the major OTC FX trading venues in 2019, it is that they’re all keen to emphasise the importance of data, both with regards to how they operate their businesses and how their clients operate theirs. On the one hand, FX trading venues are increasingly looking for ways to package and sell their market data, creating new revenue streams for the business. On the other, seemingly all of them are investing in developing trade analytics tools that will enable users of these platforms to derive greater insights from their trading activity and more effectively evaluate the liquidity and pricing available there.

Data Remains the Key Battleground for FX Platforms

Platform providers are becoming more conscious about the value of data, both for their businesses and their clients. Galen Stops takes a look at what this means for the FX industry.I f there is one consistent trend that emerges talking to all of the major OTC FX trading venues in 2019, it is that they’re all keen to emphasise the importance of data, both with regards to how they operate their businesses and how their clients operate theirs. On the one hand, FX trading venues are increasingly looking for ways to package and sell their market data, creating new revenue streams for the business. On the other, seemingly all of them are investing in developing trade analytics tools that will enable users of these platforms to derive greater insights from their trading activity and more effectively evaluate the liquidity and pricing available there.

In the FICC of It

In this week’s podcast Galen Stops shares some feedback about a previous week’s discussion on electronification of NDFs and Colin Lambert reports from an equity-focussed market structure conference, some of the statements from which, surprised him and lead to another one of his “theories” about the relationship between FX and equities. Our two podcasters also […]

Spring Time for Hedge Funds?

Hedge funds have been much maligned post-financial crisis due a perceived lack of performance. Is this criticism fair? And what is the prognosis for currency funds in particular? Galen Stops takes a look.

Earlier this year, Cliff Asness, founder, managing principal and CIO of AQR, published an excellent piece explaining why hedge fund returns should not be compared to 100% long equities returns, as they so often are when people use the S&P 500 as a benchmark.

In the article, Asness was unequivocal in his conclusion that hedge funds not keeping up with equities during a nine-year bull market was completely predictable and is certainly not a reason to worry about the performance of these firms.

Why CTAs Needn’t Fear Rising Interest Rates

Campbell & Company argues in its paper, Prospects for CTAs in a Rising Interest Rate Environment: A Refresh, that CTA performance is less dependent upon the interest rate climate than some may think.

The paper builds on the data presented by Campbell in a 2013 paper, which showed that traditional assets, such as US equities and Treasuries, have historically underperformed when interest rates are rising. In addition, it showed that CTA performance has exhibited a different pattern from these assets and has in fact not been regime-rate dependent.

Hedge Funds Outperform Stocks, Bonds – AIMA

Hedge funds have produced more consistent and steadier returns than equities or bonds over both the short term and the long term, according to new research by Preqin, the data provider, and the Alternative Investment Management Association (AIMA), the global representative of alternative investment managers.
The organisations found that hedge funds have out-performed equities and bonds on a risk-adjusted basis over one, three, five and 10-year periods. Risk-adjusted returns, represented by the Sharpe ratio, reflect the volatility of the returns as well as the returns themselves.

And Finally…

Last month I wrote about the challenges of regulating machine learning, but will AI highlight the different market structure between equities and FX – something that is a long running theme of this column? The value of AI is unarguable, but it strikes me that it will be put to different uses in FX than, for example, equities – and that is because of the different market structures of each instrument. One use is revolutionary, the other? Well we’re kind of used to it…

Exploring Correlations Between the Yen and Nikkei

SGX has released an article looking at whether the long-standing assumption that the Japanese yen is inversely correlated with Japanese equity indices, and what this means against the current geopolitical outlook.

Conventional wisdom maintains that that a weakening yen leads to stock gains, with benchmarks such as the Nikkei 225 and the Topix Index strengthening as a result.

According to the data presented by SGX, although the correlation between the Nikkei 225 Index and the Japanese yen fluctuates daily, historical evidence over the past four years shows that the inverse correlation theory holds true most of the time.