Canadian investors largely have insufficient defensive cover in their investment portfolios, warns the Alternative Investment Management Association in the AIMA Canada Handbook 2019: A Report on the Canadian Alternative Investment Landscape.
Hedge fund managers are increasingly relying on alternative data sources to inform their investment decisions. The number of alternative data providers has tripled in recent years and global spending in the space will hit $900 million by 2021, almost double what it was two years ago, according to data provider Eagle Alpha Ltd.
When rates on overnight repo jumped from low single digits to 10% on Sept. 17, various reasons were floated to account for the volatility. However, a closer examination questions whether the Fixed Income Clearing Corporation program, which was created to ease pressure on bank balance sheets might have actually contributed to the repo market volatility.
Abu Dhabi's planned Murban crude futures contracts will launch on a local platform operated by Intercontinental Exchange, sources say. ICE will reportedly be the majority owner, with minority stakes held by Abu Dhabi National Oil Co. and several European and Asian oil firms.
The Bank for International Settlements says global over-the-counter derivatives notional amounts rose 18% to a five-year high of $640 trillion during the first half of 2019. Interest rate derivatives make up some $524 trillion, or 82%, of that figure, while foreign-exchange derivatives totaled $99 trillion.
EU regulators have acknowledged inconsistency between clarification of the European Market Infrastructure Regulation and the revised Markets in Financial Instruments Directive and are working to align the two, industry sources say. The European Securities and Markets Authority acknowledges misalignment between the regulations and says in a consultation paper it has a mandate to review the matter and to make recommendations to the European Commission.
Experts reviewing a draft regulation for EU derivatives clearinghouses reportedly prefer leaving in a requirement that clearinghouses carry extra capital to ensure survival of financial shocks. The draft's language could change after the EU receives comments from member states.
Advisers and investment firms accounted for 36% for the Securities and Exchange Commission's stand-alone enforcement actions in fiscal 2019, the SEC says in an annual report. Broker-dealers accounted for 7% of stand-alone enforcement actions.
Moody's Investors Service has cut its outlook for UK debt to negative, a potential step toward a credit rating downgrade. Moody's cites "increasing inertia and, at times, paralysis that has characterized the Brexit-era policymaking process."
DekaBank, an intermediary for savings banks in Germany, has transferred more than 7,000 swap transactions from the London Stock Exchange Group's LCH clearinghouse to Frankfurt's Eurex Clearing ahead of Brexit. Eurex has offered a 100% fee discount for firms switching positions before year-end.