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Articles tagged by forwards

EBS BrokerTec Taps Coletti for Forwards Role EBS BrokerTec has hired Christopher Coletti as its new head of forwards in the US for EBS Direct. In his new role Coletti will report into Seamus O’Sullivan, global head of FX forwards at EBS BrokerTec. Coletti joins from ...
CFTC Hands SocGen Fine for FX Reporting Failure The US Commodity Futures Trading Commission (CFTC) has fined Société Générale $450,000 for failures in the reporting of certain FX transactions. The CFTC says that the French bank failed to properly report certain NDF transactions to a swap data repository (SDR), and failed to report to an SDR a large number of FX swap, FX forward, and NDF transactions in a timely manner, in violation of the Commodity Exchange Act (CEA) and CFTC Regulations. herefore, the CFTC announced an order today requiring Société Générale to pay a $450,000 civil monetary penalty and to cease and desist from committing further violations of the CEA and CFTC Regulations.
CLS Volumes Up for March The average daily traded volume (ADV) submitted to CLS was $1.6 trillion in March, up 6.7% from February. This figure also represents a 9.6% increase from the $1.46 trillion ADV recorded for the same period a year ago. At $462 billion in ADV, spot volumes were up 8.1% month-on-month, but down 1.3% year-on-year for March. In contrast, swap volumes in March reached $1.04 trillion ADV, a 14% increase from the year before and a 6.2% increase from February. Meanwhile forward volumes, at an ADV of $95 billion, were up 3.3% month-on-month and up 17.3% year-on-year, in March.
CLS Data Shows Dip in FX Volumes The average daily volume (ADV) submitted to CLS in April was $1.52 trillion, down 5% from the ADV of $1.6 trillion that it reported in March. The ADV of spot FX trades submitted to CLS was $435 billion in April 2017, down 5.8% month-on-month and down 8% year-on-year. The ADV of swaps trades submitted to CLS was $988 billion in April, down 4.9% from the previous month, but up 1.2% compared to April 2016. Similarly, the ADV of forwards trades submitted to CLS was down month-on-month, but up year-on-year. CLS reported an ADV of $93 billion for forwards products in April, down 2.1% from March, but up 24% compared to April 2016.
CLS Volumes Tick Up in May The average daily traded volume submitted to CLS was $1.55 trillion in May, up 2% from the previous month and up 10% year-on-year. The CLS data shows FX spot ADV of $454 billion in May, up 4.4% compared to April and up 4.8% from May 2016. Swap ADV, meanwhile, was $989 billion in May, which was flat on the previous month, but up 9% in comparison to the same month last year. Although by far still the smallest product segment submitted to CLS in terms of ADV, FX forwards saw the biggest month-on-month and year-on-year increases in May.
CLS Volumes Up in June The average daily volume (ADV) of trades submitted to CLS was $1.64 trillion in June, up 6% from $1.55 trillion in May, and up 1.64% year-on-year. The main driver of this growth appears to have been an increase in swaps and forward activity. Swaps accounted for $1.08 trillion of the ADV submitted to CLS in June, up 9.3% month-on-month and 7.5% year-on-year. The ADV of $108 billion in FX forwards in June represented a 3.8% increase from the previous month and a 20% growth from June 2016, when an ADV of $90 billion was recorded.
CLS Volumes Dip Slightly in July The average daily volume (ADV) submitted to CLS was $1.6 trillion in July, down 2% month-on-month, but up 11.9% year-on-year. CLS recorded an ADV of $1.04 trillion in swaps in July, down from $1.08 trillion the previous month. Spot ADV submitted to CLS in July was $453 billion, basically flat from the $455 billion recorded in June. The ADV of forwards products submitted to CLS last month was $101 billion, down from $108 billion in June. However, year-on-year, forwards ADV in July was up 46%, while spot ADV was up 13.9%. By contrast, the spot ADV submitted to CLS in July 2016 was $446 billion, only 1.6% less than July 2017.
CLS Volumes Flat in August Average daily volume (ADV) submitted to CLS was $1.58 trillion in August, down 1% from July. CLS recorded an ADV of $1.05 trillion in swaps in August, up from $1.04 trillion the previous month. Spot ADV submitted to CLS in July was $433 billion, down marginally from the $453 billion recorded in July. The ADV of forwards products submitted to CLS last month was $96 billion, down from $101 billion in July. Despite this month-on-month decrease, CLS volumes were up 14.8% year-on-year.
Thomson Reuters Also Enjoying September Uptick Thomson Reuters (TR) is the latest FX platform to post strong September trading volumes, with figures released today showing that the average daily volume (ADV) of FX trading across all its platforms was $411 billion.  This represents a 12% month-on-month (MoM) and a 12.6% year-on-year (YoY) increase in volumes.  This total reflects trading volumes on Thomson Reuters Matching and FXall in all transaction types, including spot, forwards, swaps, options and non-deliverable forwards (NDFs).  The volumes data on TR’s website only stretches back to January 2013, but this represents the highest overall ADV across all of its platforms since then. 
CLS Volumes Up Double Digits in September The average daily traded volume submitted to CLS was $1.75 trillion in September, up 10.7% from $1.58 trillion in August 2017. This increase is consistent with data that has already been reported by various FX platforms, which all showed a substantial increase in trading activity last month. The ADV of swap activity submitted to CLS was $1.14 trillion in September, up 8% from August and up 16% compared to September 2016. The average daily traded volume submitted to CLS was $1.75 trillion in September, up 10.7% from $1.58 trillion in August 2017. This increase is consistent with data that has already been reported by various FX platforms, which all showed a substantial increase in trading activity last month. The ADV of swap activity submitted to CLS was $1.14 trillion in September, up 8% from August and up 16% compared to September 2016.
Is the Stage Finally Set for FX Clearing? Galen Stops takes a look at whether the predictions of FX moving towards a centrally cleared model might finally be coming true.  Central clearing for FX has endured a number of false dawns in recent years. As long ago as 2011, Profit & Loss published an article, “FX Clearing – Are You Ready?” in which it was argued that Dodd-Frank was likely to drive FX options and NDFs products into clearing. Then back in the first quarter 2014, staff at the US Commodity Futures Trading Commission (CFTC) indicated that the guidelines for the mandatory clearing of FX derivatives products, which included NDFs could be finalised within weeks. Indeed, Profit & Loss reported in mid-June 2014 that the CFTC was poised to fire the starting gun for mandatory FX clearing.
CLS Volumes Tick Up in November The average daily volume (ADV) of trades submitted to CLS was $1.677 trillion in November, up 3.8% from the previous month and up 9.2% year-on-year. This increase in volumes was largely driven by swaps trading. CLS reports an ADV of $1.149 trillion in swaps submitted last month, which represents a 5.4% increase from the $1.09 trillion submitted in October and a 22.6% increase on the $937 billion submitted in November 2016. Meanwhile, the ADV for FX spot submitted to CLS was $439 billion in November, up 2.8% from the previous month, but down 14.6% year-on-year. Forwards represented $89 billion of the total ADV submitted to CLS in November, down 10% from October but up 4.7% compared to November 2016.
Redline Supports FX Forwards, NDFs on Cboe Platforms Redline Trading Solutions has announced support for outright deliverable foreign exchange (FX) forwards traded on Cboe FX Markets and non-deliverable FX forwards (NDFs) executed on Cboe SEF. This means that firms that are FX clients of Cboe using Redline’s InRush Market Data Ticker Plant and Order Execution Gateway can now receive market data and execute FX forwards on Cboe FX and NDFs on Cboe SEF via a single server. “We are seeing significant interest in NDFs on Cboe SEF from our customers, and we are excited to be among the first providers to integrate with Cboe’s new venue,” said Mark Skalabrin, CEO of Redline.
Built to Become Big Galen Stops takes a look at how and why Aston Capital Management is planning to scale up following its recent $100m investment.  Aston Capital Management recently received an injection of $100 million in AUM and an additional $5 million in seed operating capital from private investors.  Following this investment, the firm’s CEO Isaac Lieberman is, perhaps unsurprisingly, bullish about its future. “We have a goal through our strategic mandate and product development timeline to have capacity to be managing $2 billion in AUM within two years and I can actually see us achieving this goal quickly as this business accelerates,” he says. To help achieve this goal, Lieberman has deliberately been structuring the firm so that it can easily scale up in the future. For starters, the firm has been getting a whole slew of regulatory and accountancy registrations in place.
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.
IS Prime Adds to Agency Execution Offering IS Prime, part of ISAM Capital Markets, is launching an NDF and forward execution facility within its agency desk. The firm says its agency execution service leverages its relationships with top tier banks whilst also utilising the technology resources of ISAM’s hedge fund business. It provides mid-tier and smaller banks, hedge funds and voice traders with an anonymous, customised liquidity solution with liquidity from the major market making banks, non-bank LPs and selected ECNs. “The addition of NDFs and forwards in our agency execution business shows a steadfast commitment to doing all we can to meet our institutional clients’ growing demands,” says Raj Sitlani, managing partner, IS Prime.
Oanda Offers FX Forward Rates to Corporates Oanda will now offer forward rates to corporate clients around via its Exchange Rates API. This new data set aims to provide corporate treasurers and finance directors with an accurate, trustworthy view of the forwards market, offering over 360 forward rate currency pairs – which Oanda claims is more than any other currency data feed on the market. Data is delivered via Oanda’s API and can be integrated into any treasury management system, enterprise resource planning system or billing software solution. “Having been a trusted source of FX data for more than 20 years, Oanda is uniquely positioned to create a market consensus despite the decentralised treasury market, enabling us to deliver reliable forward rates to our clients.
Industry in Alignment Over CFTC Swap Dealer Rules There appeared to be a broad consensus in the responses to the Commodity Futures Trading Commission’s (CFTC) proposed swap dealer rules that the Commission should retain the current $8 billion de minimis threshold for swap dealer (SD) registration and that NDFs should be excluded from the threshold calculations. Since 2012, Commission regulations have stated that market participants will not be considered a "swap dealer" unless they trade over $8 billion per year in aggregate gross notional amount (AGNA). This $8 billion threshold was meant to be a temporary phase-in period, with the threshold ultimately due to be reduced to $3 billion.
Citi, Eaton Vance Clear First FX Cash-Settled Forwards Citi and Eaton Vance Management have cleared the first FX cash-settled forwards at CME Group. CME cleared the two EUR/USD trades on January 15. The exchange group currently offers clearing for 26 currency pairs of FX cash-settled forwards and 11 pairs of NDFs.“CME Group is pleased to clear our first cash-settled forwards, which provide a new capital-efficient way for our customers to trade G10 foreign exchange. This first cash-settled trade, combined with the recent increase in our non-deliverable forward clearing volume in late 2018, allows us to work with our clients, clearing members and liquidity providers to help customers mitigate their risks through cleared solutions,” says Sean Tully, global head of financial and OTC products at CME.
FX Volumes Dip from April 2018 Highs The latest round of FX turnover data from a group of the world’s FX Committees show that volumes dipped slightly in October 2018 compared to April last year when they hit a new high mark. Average daily reported UK FX turnover was $2.6 trillion per day in October 2018. Although this is the third largest turnover figure on record, it represents a 4% decrease from the record high of $2.7 trillion reported in April 2018. Turnover by instrument was mixed in the UK. Spot increased for the third successive reporting period, gaining 3% compared to April 2018 to reach $775 billion traded per day. This represents a 14.5% year-on-year increase in volume.
P&L Talk Series With: Kate Lowe Kate Lowe, global head of trade services at State Street, talks to Profit & Loss about how new margin requirements could shape buy side behaviour in the FX market, and why 2019 is likely to be a “staging” year for many of these firms.Profit & Loss: As you’ve been talking to clients at the start of 2019, what’s been the major areas of focus for them?Kate Lowe: Well one of the big talking points at the moment is the impact that the uncleared margin rules (UMR) are going to have on the industry. In September this year, the threshold for firms that have to post initial margin for u