The Financial Industry Regulatory Authority is investigating whether traders have manipulated the Cboe Volatility Index to influence prices of VIX-based derivatives, sources say. FINRA would refer questionable trading patterns to Cboe Global Markets, which would notify the Securities and Exchange Commission if necessary.
Intercontinental Exchange hopes to launch eight energy-derivatives incentive schemes covering petroleum-based products starting Feb. 22 and ending Dec. 31. The launch will come days after ICE transfers 254 energy futures contracts to ICE Futures US from ICE Futures Europe.
Financial regulators could minimize market fragmentation and disruption caused by Brexit if they significantly improve cooperation, says David Wright, who headed the International Organization of Securities Commissions from 2012 to 2016 and who leads a financial industry body in France. Authorities could build trust through real-time information sharing for major markets, he says.
UK fund managers could lose EU market access without a post-Brexit agreement, the European Commission says. It adds that Undertakings for Collective Investment in Transferable Securities status expires when Brexit occurs.
Regulators are intensifying scrutiny of foreign exchange market liquidity and fragmentation, says Andrew Busch, chief market intelligence officer at the Commodity Futures Trading Commission. "We worry about the fragmentation, the different pricing that will occur, the different pockets of liquidity that people have to access," he says.
The Securities and Exchange Commission has questioned Credit Suisse about circumstances behind the termination of an exchange-traded VelocityShares product after the value plunged, sources say. The SEC reportedly wanted to know how performance was calculated and whether retail investors were shareholders.
China's establishment of the Financial Stability and Development Committee, which oversees and aims to unify the four major regulators, appears to be improving cooperation, with all four agencies agreeing to adopt a set of rules on bonds. However, while some market participants hail improvement in the regulatory apparatus, others expect challenges in detailed implementation of rules.
India International Exchange CEO V. Bala says a ban on data and index licensing by major exchanges is good for drawing foreign market participants to the country's international financial-services center. "Effectively, we hope this will bring more foreign participants to engage with us and deepen the liquidity pool, which has grown significantly since our humble beginning a year back," Bala said.
Investors are eyeing firms in high-frequency trading after stocks for Virtu Financial and Flow Traders surged during recent market volatility. Billionaire Mark Cuban, once an HFT critic, is among those investing in Virtu.
A report notes that unless the buy side engages more in development of applications for distributed-ledger technology, asset managers and their clients will miss the chance to develop the maximum benefit. The report recommends that participants collaborate more effectively.
FIA's Operations Americas Division will be hosting the 2018 Annual Meeting & Washington Update on Feb. 22 at the Union League Club of Chicago. Please join the division as Walt Lukken, president and CEO of FIA, provides his annual Washington Update and shares his thoughts on the D.C. landscape, as well as challenges and opportunities facing the industry in 2018. This event is open to members and nonmembers of the Operations Americas Division. Register now!