European Parliament delays futures open-access rules

Cboe Global Markets launching revamped volatility index | Derivatives industry experts discuss lessons learned from COVID-19 crisis | ICE Clear: Margin calls need to be flexible

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June 25, 2020

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FIA's Daily Summary for Derivatives Industry Professionals

The European Parliament has voted to postpone open-access rules for futures by a year. The vote follows a warning from the European Securities and Markets Authority that companies are behind with preparations for the rules, which remove a need for trading and clearing to occur at the same venue.

Full Story: The Trade (UK) (6/24), Reuters (6/24), Financial Times (subscription required) (6/24), Law360 (subscription required) (6/24)

Cboe Global Markets launching revamped volatility index

Cboe Global Markets plans to launch a volatility index based on the iShares 20+ Year Treasury Bond exchange-traded fund during the third quarter. Cboe also plans to expand its indexes-based interest-rate swaps offering and eventually list futures and options.

Full Story: BNN Bloomberg (Canada) (6/24)

Industry Developments

Derivatives industry experts discuss lessons learned from COVID-19 crisis

Day two of FIA's IDX-V conference featured virtual presentations exploring how recent volatility has affected the trading and post-trade processing of cleared derivatives, and how the industry has continued to function in a world in lockdown.

Full Story: MarketVoice (6/25)

ICE Clear: Margin calls need to be flexible

ICE Clear Europe president Hester Serafini told FIA's IDX-V conference that having regulators impose a one-size-fits-all approach to the way clearinghouses determine margin calls would be "very dangerous." Serafini said that "the clearinghouse needs to have the flexibility to call margin based on the situation at hand."

Full Story: Futures & Options World (subscription required) (6/24), Risk (subscription required) (6/24)

Exchange execs discuss how staff will return to office

Top executives from several major exchange groups discussed how they will go about returning remote staff to the office at FIA's IDX-V conference. "We've been really happy with our ability to work from home across all of our regions so we're not in a huge hurry to get people back in but we are aware that some people are in a hurry so we are trying to find the right balance," said CME Group COO Julie Holzrichter.

Full Story: Futures & Options World (subscription required) (6/24)

FIA chair Kemp announces retirement

Jerome Kemp, chairman of FIA and global head of futures, clearing and collateral at Citigroup, has announced his retirement. "In his nine years on the board, and the last two as chair, Jerome has worked with distinction to drive positive change for our industry. His leadership has raised the standards for our industry to make our markets more resilient, safer and competitive," said FIA president and CEO Walt Lukken. FIA vice-chair Nicholas Rustad will serve as acting chair until board elections are held next spring.

Full Story: Futures & Options World (subscription required) (6/24)

Retail trading surge extends to options contracts

The surge in trading among retail investors, drawn in by low-fee trading on user-friendly apps, has extended into the options market. Data from Options Clearing Corp. indicates that a record 28 million options contracts per day have been traded this year.

Full Story: The Wall Street Journal (tiered subscription model) (6/24)

Hehmeyer pivots fully to cryptocurrency services
CoinDesk (UK) (6/24)

Execs: Libor phase-out on track, despite pandemic disruptions
Risk (subscription required) (6/25)

King's hedge fund knows how to short oil
Financial News (UK) (subscription required) (6/24)

ICE's London office to reopen on Monday
Futures & Options World (subscription required) (6/24)

Cboe launching new FX platform to rival CME, Refinitiv
Financial Times (subscription required) (6/24)

Regulation and Enforcement

Chancellor: UK will not adopt EU settlement regime

A statement from Chancellor Rishi Sunak on the UK Treasury website has confirmed it will not adopt the EU's Settlement Discipline Regime next February and firms should continue applying the existing regime. The move means UK firms will avoid applying the framework's buy-in rules, but must still follow European rules on transactions settled with European central securities depositories.

Full Story: The Trade (UK) (6/24)

23 banks seeking to recoup Hin Leong losses

HSBC Holdings, which had a $600 million exposure to Singapore's now collapsed Hin Leong Trading, is among the 23 banks owed almost $4 billion, according to court filings. Hin Leong currently has $3.5 billion in liabilities, making it more difficult for banks to recoup their money.

Full Story: BNN Bloomberg (Canada) (6/24), Financial Times (subscription required) (6/24)

N.Y. proposes easier licensing for cryptocurrency firms
Reuters (6/24)

Technology

FICC algo trading good practice guidelines issued

The FICC Market Standards Board has issued good practice guidelines for algo trading in the FICC markets in a move to reduce risk and promote good conduct and governance among traders. FMSB's statement of good practice lists 10 points that market participants and venue operators should follow.

Full Story: The Trade (UK) (6/24)

MARKTS uses Deribit to offer bitcoin futures, options
Futures & Options World (subscription required) (6/24)

FIA News

WEBINAR 16 July: Insights into the derivatives clearing business

Will Mitting, founder and managing director of Acuiti, a management intelligence platform focused on the derivatives industry, will join Will Acworth, senior vice president of FIA, in a 30-minute presentation on trends in the business of clearing listed and OTC derivatives. The discussion, taking place on July 16, will cover proprietary data from global surveys of derivatives industry executives conducted by Acuiti as well as the latest data from the US on customer funds flows. Learn more and register!