Jim Allen, CFA, head of Americas capital markets policy at CFA Institute, and Eric Boess, CFA, director and global head of derivatives at RCM Allianz Global Investors, discuss the impact of derivatives reform on global derivatives trading.
Of the shift fromover-the-counter (OTC) derivatives trades onto exchange-like structures, “The general idea to make markets more transparent and hence more stable is absolutely right. The problem is how you do it, and what you achieve on the way there might not be exactly only positive.”
Goldman Sachs has brought to NYSE Arca an exchange-traded fund that buys investment-grade corporate bonds with maturities of no more than five years. The Goldman Sachs Access Investment Grade Corporate 1-5 Year Bond ETF seeks to replicate the performance of the FTSE Goldman Sachs US Investment-Grade Corporate Bond 1-5 Years Index. ThinkAdvisor (free registration) (09 Jul.)
US midsize banks preparing to phase out Libor are showing a preference for the American Interbank Offered Rate, an unsecured overnight rate, rather than the Secured Overnight Financing Rate, which the Alternative Reference Rates Committee favors. The banks say Ameribor relates more closely to their cost of funds. Practice Insight (09 Jul.)
German authorities are investigating allegations that executives at insolvent payment processor Wirecard have been involved in money laundering. This adds to several German and US inquiries into the firm's activities. The Wall Street Journal (tiered subscription model) (09 Jul.)
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