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Category Archives: John Lothian Newsletter

The John Lothian Newsletter provides news and commentary about the global exchange traded derivatives, securities, environmental and related OTC markets. The daily email intelligence briefing and companion blog are edited by and .

John Lothian Newsletter: BATS Sweetens Terms for Individuals Trading Stocks; CME rival says regulator’s swap rule change disruptive; Exchanges protest over margin rules Standard

BATS Global Markets gets regulatory approval to offer pricing incentives to individuals who trade stocks. The DTCC, locked in a battle with CME Group and the CFTC over swap data reporting, takes issue with this week’s CFTC decision to pull back under pressure from CME Group. Around the world, global reform has exchanges under pressure, and claims are made that increased regulation will lead to increased costs, threatening income during a time when trading volume is already significantly lower.

John Lothian Newsletter: FSA backs LME’s £1.4bn sale to HKEx; LCH.Clearnet set for Asian expansion; Dodd-Frank Swap-Clearing Rule Gets CFTC Final Approval Standard

Hong Kong Exchange gets approval from Britain’s financial regulator to proceed with its acquisition of the London Metal Exchange. Clearing house LCH.Clearnet looks to Asia as a way to diversify beyond Europe in the hunt for new business. The CFTC gives a final approval to a Dodd-Frank related swap clearing rule, starting waves of effect at banks and clearing houses. In today’s First Read, check out the new MarketsWiki.tv interview with Ryan Baccus of Sapient, who discusses Dodd-Frank compliance and the Clearing Connectivity Standard. Next, there’s a MarketsWiki Five Minutes interview with Alice Botis of Fidessa, who talks about liquidity…

John Lothian Newsletter: Xetra head to leave Deutsche Börse; BATS to borrow $300m for dividend payouts; Approval Pending, Miami Exchange Plans Its Launch Standard

Deutsche Börse announces changes to its senior management team. Exchange operator BATS looks to the debt market for financing, its first attempt to raise money since its failed self-IPO this past March. Miami Options Exchange forges ahead with plans to open its doors in early December, despite a lack of regulatory approval for that action. If you missed yesterday’s release of the second part of JLN’s Restoring Customer Confidence series, you’re in luck. Watch the interview with Eurex’s Byron Baldwin and learn how Eurex handles customer account segregation.

John Lothian Newsletter: Schapiro stepping down at SEC, Walter to step in; Britain names Canadian to head Bank of England; Spanish Futures Trading Resumes After BME Technical Fault Standard

As expected, Mary Schapiro announces her departure from the SEC, and Elisse Walter is tapped to take her place. Canada’s Mark Carney heads to Britain to take the head chair at the Bank of England. Spanish futures exchange MEFF shut down for several hours today; a “connectivity” issue was blamed, and trading has now resumed. The second installment in JLN’s Restoring Customer Confidence series has arrived: Eurex’s Byron Baldwin talks about the exchange’s flexible segregated account services.

John Lothian Newsletter: Chi-X Australia Seeks New CEO as Fowler Will Step Down; CFTC approves CME swap data repository; Timing is crucial for Nasdaq OMX derivatives venture Standard

Chi-X Australia says that CEO Peter Fowler will cease to act in that role in early 2013, but will remain on the board of directors for the venue. CME Group receives CFTC approval to proceed with its derivatives data warehouse project. Nasdaq OMX moves aggressively to open its new interest-rate futures trading platform in order to take advantage of new European clearing regulations.

John Lothian Newsletter: Bats Chi-X Europe to unveil price rises; Australian reforms to limit flash crash risk; Ex-SAC Manager Martoma Charged in Record Insider Scheme Standard

Bats Chi-X Europe moves to substantially change its fee and cost structure for market participants. Australian regulators move to restrict and rein in high frequency traders and dark pool providers. An arrest is made regarding insider trading charges at SAC Capital Advisors, with the founder of that firm implicated for the first time in the complaint.

John Lothian Newsletter: Japan Exchange Clears Last Hurdle as Shareholders OK Deal; Aquis Exchange appoints first directors; LCH in Singapore FX clearing talks Standard

Tokyo Stock Exchange and Osaka Securities Exchange round the corner toward the merger finish line, as shareholders signal approval for the deal. Aquis Exchange, a new venue in Europe slated to open for business around the middle of next year, has hired its first directors. LCH.Clearnet looks to establish a hold in Asia as it discusses currency derivatives clearing with Singapore Exchange.

John Lothian Newsletter: US ‘dark pool’ trades up by 50% in 3 years; A search for ‘common ground’: ‘Fiscal cliff’ negotiations begin; ‘Shadow Banking’ Up to $67 Trillion, Financial Group Says Standard

Where has equity volume gone? In part at least, it’s headed out the exchange door and over to a dark pool in the last few years. Politicians, still in a mindset that allows them to debate whether a fiscal cliff dive is a reasonable way to do their job, begin to consider working together as a possible way to find a solution to financial problems. A financial group finds that shadow banking – financial transactions beyond the regulatory stockade – is not merely a substantial industry, but huge.

John Lothian Newsletter: Nasdaq Opens Danish Bond Exchange in Loan Drought; CFTC to Appeal Ruling Rejecting Dodd-Frank Trading Limits; ICAP closes a US trading division Standard

Nasdaq rolls back the tarp on a new trading platform in the hopes of matching investors to Scandinavian bonds. The CFTC votes to appeal the recent court decision rejecting its position limit proposal. Broker ICAP decides to shut down NYSE floor trading operations as it works to weather the global low-volume storm. If you haven’t already, take a look at JLN’s first video in the new Restoring Customer Confidence series, as Ron Filler of New York Law School examines how gross margining can improve the risk to customer accounts.