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Category Archives: Commentary

Commentary from the John Lothian News staff and guests editors.

Interest (in) rates: CME’s suite soars Standard

Despite historical seasonality trends pointing to decreased trading activity in summer months, CME’s interest rate complex has been red hot. In the past month, CME Group has experienced records in a variety of rate-related products in terms of average daily volumes, open interest, electronic trading and investor participation. Average daily volumes (ADV) and open interest (OI) in Ultra 10-year Treasuries, Wednesday Weekly Options on Treasuries (just launched in June), electronic trading of eurodollar options are all at highs and foreign investor participation is on the rise.  (See the infographic below for more.) In August, OI in treasury options reached a record;…

Cloudy with clearing: What the next clearing house looks like Standard

John Davidson joined OCC as president and chief operating officer in May with a firm focus on ushering in the next generation of clearing technology for the world’s largest clearing organization. Davidson is one of several recent executive team hires tasked with executing the switch from one established technology platform to something new. This is no small task for Davidson, who reports to OCC Chairman and CEO Craig Donohue and works closely with Scot Warren, OCC’s executive vice president and chief administrative officer. OCC’s ENCORE system now stands at about 20 years old, and while there have been many upgrades,…

Revamping data provision: YData rolls out Standard

Professionals in the trading world are turning to all sorts of data tools, from technology that scrapes Twitter for actionable sentiment to satellite imagery of shipments, all in search of alpha. Now, Chicago-based YCharts is getting into the tradeable intelligence field. Founded in 2009, YCharts offers financial data and analysis tools through a web platform which covers 50,000 stocks, ETFs and mutual funds. YData is a new offering from the firm which uses machine learning and natural language processing to scour the internet for intelligence. YData’s first feed is “Corporate Events.” But this isn’t just an earnings feed. YData searches…

CloudQuant Opens the Trading Door to a Crowd Standard

News broke today that CloudQuant allocated $15 million to a non-employee, crowd researcher using its platform. Thus begins what I think is one of the most interesting, innovative, disruptive and game changing market trading concepts. Somewhere in the United Kingdom, a professor with a day job now has had his strategy tested by CloudQuant’s platform and attracted a $15 million dollar allocation. That account is now traded by a professional with high frequency trading skills and a focus on best execution who is working on an agency basis to trade the algorithmic strategy for CloudQuant. The professor does not enter…

Thesys vs. Goliath: That’s One Big CAT Standard

Small company wins big with opportunity to build the Consolidated Audit Trail covering U.S. equities and options. FINRA, FIS, Cinnober, Thomson Reuters – what do they have in common? They are just a few of the 30 bidders who lost out on developing the Consolidated Audit Trail (CAT) to Thesys Technologies LLC, a subsidiary of the proprietary trading firm Tradeworx, founded in 2009. To develop and implement the CAT, Thesys partnered with IBM (which was a bidder on its own, too), as well Rosenblatt Securities and law firm Latham & Watkins. “You had some big tech companies that really understand…

Russell Suite Competition Ambiguity Raises Some Questions Standard

Exclusive. Non-exclusive. Exclusive. CME. ICE. CME again. The story of the Russell Index futures complex licensing over the years is a study in ambiguity, changing strategies and partners. We know the  will win this round as they currently hold the long term license for the products. But what will happen in the short term is ambiguous as these two global exchange giants square off and try to maintain control or pry loose the open interest in the Russell futures products. After ICE took over an exclusive Russell indexes licensing agreement from CME in 2007, CME returned the favor by recently…

Financial Markets Leaders Remember the late Magnus Bocker Standard

I asked several leaders around the exchange world to offer remembrances of Magnus Bocker, the late former CEO of SGX. To start, I shall offer my own and add additional remembrances as they come in. I first met Magnus Bocker at a Deutsche Bank investment banking financial technology conference in New York where I had been asked to moderate an exchange leader panel. Magnus was then president of Nasdaq OMX. Also on the panel was Larry Leibowitz representing NYSE Euronext. Magnus was always gracious with me. He was likable, always smiling, whip-smart and well-dressed. In fact one year at the…

The Next Big Thing; Seismic Foundry Aims To Find The Next Disruptors And Leaders In Fintech Standard

Who will be the next big thing in our industry? A new London-based firm is aiming to find it. Seismic Foundry, co-founded by Bill Templer, Brendan Bradley, Cathryn Lyall, Dave Feltes and Jeff Gale, is looking for the next fintech start-up that could become the next superstar in the financial industry. Of course, they are not alone and there are many firms from Chicago to New York to London and beyond that are looking to invest in those firms aiming to solve industry problems and disrupt inefficient sectors. But they are aiming at a slightly different market sector in the…

Jim Kharouf Made a Strong Statement Standard

Jim Kharouf

FOW-JLN Event Showed His Impact on Program Jim Kharouf made a strong statement with his design, leadership and execution of the FOW-JLN Trading Chicago event on June 28th in collaboration with the FOW team and I hope the industry took notice. The event drew 210 people to talk about the key issues facing money managers, traders, exchanges, clearinghouses, brokers, vendors and the industry. What was special about the co-sponsored event was that the program used many of the items in our toolbox to deliver an interesting, educational, lively and real event. With much help and support from FOW, we featured…