Securities Industry News articles from February 2007

Securities Industry News archives from February 2007

Closely Watched Partnership: NYSE, Tokyo Exchange Already Tight.
February 5, 2007... Before last week, reports of a brewing strategic alliance of NYSE Group and the Tokyo Stock Exchange (TSE) were repeatedly dismissed as premature. But John A. Thain and Taizo Nishimuro, the markets' respective CEOs, made clear that cooperation...

U.K. Pandemic Test Shows Limits of Off-site Alternatives: Working from home doesn't replicate market activity.
February 5, 2007... The potential pandemic of avian flu is much more feared and talked about than the numbers of cases--concentrated last year in Indonesia (56), Egypt (18) and China (13)--would suggest. But worst cases are what contingency planners are paid to...

Embedding Risk in Regulation.(Brief article)
February 5, 2007... With each passing year, and with improved knowledge and analytics, risk management disciplines are being applied across an ever-broader swath of financial institution operations and transactions. But only after the mutual fund scandals of 2003...

Hedge Funds and Servicers Face Op Risk Issues.
February 5, 2007... The collapse last year of Amaranth Advisors, coupled with increased institutional scrutiny, has pushed operational risk higher on the management agenda for hedge funds, their service providers and regulators alike. Even before hedge funds...

Wombat Buys Harco for Data Compliance.
February 5, 2007... Low-latency and data-feed solutions provider Wombat Financial Software has made its first acquisition, buying U.K. data management software company Harco Technology to assemble a unified market-data entitlements product. Wombat, which has...

ADP Signs Third Self-clearing Outsourcing Customer.
February 5, 2007... Automatic Data Processing (ADP) has begun servicing its third clearing and outsourcing customer in a unique hybrid arrangement that allows the broker-dealer to remain self-clearing while outsourcing most clearing functions. The signing of...

Cowen Opts for New Clearer Over Former Parent Societe Generale.
February 5, 2007... Fidelity Investments' National Financial clearing unit recently converted a large institution-oriented broker-dealer correspondent, Cowen, to its platform and away from that of Societe Generale Securities Services (SGSS), which is in the...

More Asian MOUs.(Abu Dhabi Securities Market)(memorandums of understanding between stock exchanges)
February 5, 2007... The New York Stock Exchange-Tokyo Stock Exchange alliance was the big exchange-cooperation event of last week, overshadowing at least two other concrete developments in the direction of transcontinental market integration: memorandums of...

OptionsXpress Self-clears.
February 5, 2007... Online brokerage optionsXpress has implemented SunGard Data Systems' Phase 3 processing system to self-clear equities, options and fixed-income trades. The Chicago-based firm previously used Goldman Sachs Execution & Clearing but wanted to gain...

Buy-Write Options.(Brief article)
February 5, 2007... The Options Industry Council has initiated educational efforts for institutional investors by supporting a study of the performance of a buy-write strategy on the Russell 2000 Index (RUT). The results, available at the newly launched...

People In The News.
February 5, 2007... Bids Trading named Richard Levin, an experienced legal counsel for electronic trading organizations, as general counsel, chief compliance officer and secretary to its board. Bids, short for Block Interest Discovery Service, was founded in...

Trading Places: Broker-Dealers Adapt to Change.
February 5, 2007... The world of trading is exponentially more complicated today than it was just a few years ago, and the field of play is undergoing unprecedented change. Stock exchanges are consolidating, going public and becoming more global. The product mix...

Penny Trading Pilot Live: Relatively small scale keeps data challenges manageable.
February 5, 2007... The much anticipated trial of penny-increment options trading began Jan. 26 at the six U.S. options exchanges. The pilot involves 13 stocks and exchange-traded funds (ETFs), and trading increments will be 1 cent for options at less than $3 and...

Two-Track Approach May Extend Sepa Migration.
February 5, 2007... On Nov. 22, 2006, the European Associations of Corporate Treasurers (EACT) signed memorandums of understanding (MOUs) with both Swift and Twist. The objective: to harmonize the two standards-setting organizations with EACT's Cast, or Corporate...

U.K. Software Firm in U.S. Marketing Partnership: Financial Tradeware eyes vast numbers of smaller hedge funds.
February 5, 2007... London-based software company Financial Tradeware has signed a partnership agreement with Computer Intelligence Group (CIG) to market, install and support its administration, accounting and compliance products for small and midsized hedge...

Risk-Based Regulation Comes of Age: Regulators use risk assessment to allocate resources, put examiners in hot zone'.
February 5, 2007... In 2003, when the wave of market-timing and late-trading scandals broke over the securities industry, Securities and Exchange Commission chairman William Donaldson was under pressure to initiate basic changes in the way the SEC regulated the...

Op Risk on the Front Burner.
February 5, 2007... Eric Gordon, director of research at Gordon Asset Management, a hedge fund of funds in Rye, N.Y., remembers when there wasn't a great deal of emphasis on the issue of operations management due diligence--which has become better known among the...

Could Basel II Lag Weaken U.S. Competitiveness?
February 5, 2007... U.S. implementation of Basel II, the latest generation of bank capital standards to come out of the Basel Committee on Bank Supervision, is falling behind, even as European banks prepare--or have prepared--themselves for imminent deadlines....

Few U.S. Securities Firms Will Toe Basel II Line.
February 5, 2007... Only a handful of U.S. securities firms fall under the Basel II bank capital standards, in contrast to those in Europe--all of which must comply. Most U.S. broker-dealers adhere to capital requirements set by the Securities and Exchange...

China's Gaps in Risk Management: Emerging economy needs regulations, competition--and follow-through.
February 5, 2007... China's regulators have been diligently working to raise the level of risk management in the securities industry. But regulations alone won't eliminate the bad practices that long plagued the country's markets--and improvement will require...

A New Must-Have: An SAS 70 Audit.
February 5, 2007... Only in the past several years have investors in hedge funds begun to closely scrutinize these entities' people, processes and infrastructure--in short, the level of operational risk management. Before, due diligence was mainly concerned with a...

Moody's Broadens Its Risk Management Portfolio.
February 5, 2007... At the end of 1996, collateralized debt obligations (CDOs) outstanding in the U.S. totaled $1.4 billion, according to the Securities Industry & Financial Markets Association. By the third quarter last year, that figure had ballooned to $297...

State Street's Purchase of IFS Will Make It Number Two in Custody.(Investors Financial Services Corp. acquisitions)(Financial report)
February 12, 2007... With the Feb. 5 announcement that it will acquire Investors Financial Services Corp. (IFS) for $4.5 billion, State Street Corp. of Boston again finds itself fueling the consolidation momentum that has been redefining the intensely competitive...

Letting Hedge Funds Be Hedge Funds: FSA tries to show rest of Europe that a light touch is enough.
February 12, 2007... Hedge funds are one of the last bastions of unregulated--or lightly regulated--securities market activity in the U.S., which, for all of the Securities and Exchange Commission's efforts to impose registration and other oversight requirements,...

Goldman Bolsters Research Offerings With Third-Party Tools, Technologies: Buys strategic stakes in Connotate, Investars, two others.
February 12, 2007... Seeking to enhance its research and set itself apart from competing firms, Goldman Sachs & Co. has begun supplementing its products with a series of analytical and technology-based capabilities developed by others. The vehicle for the offering...

No-Action Reaction: More Questions On Soft Dollars, Commission Sharing.
February 12, 2007... No-action letters from the Securities and Exchange Commission are supposed to clarify fine or ambiguous points of law. But one that the agency issued last month on a Goldman Sachs & Co. commission management program stirred both confusion and...

SunGard Buys Chinese Trading Systems Supplier Fudan Kingstar.
February 12, 2007... In a sign that the maturing of the Chinese financial markets is creating new opportunities for Western technology suppliers, SunGard Data Systems of Wayne, Pa. has acquired Shanghai-based Fudan Kingstar Computer Co. SunGard, which did not...

Korea Eases Derivatives Access for Foreign Institutional Investors.
February 12, 2007... Following December rule changes, Korea Exchange (KRX) is allowing foreign institutions to trade 7,500 futures contracts on the Kospi 200 stock market index, up from the previous limit of 5,000. As part of the easing, foreigners can now pay...

Korea Exchange To Provide Bond Trading Platform to Bursa Malaysia.(contracts)
February 12, 2007... Kuala Lumpur exchange Bursa Malaysia announced Jan. 19 that it contracted with the Busan-based Korea Exchange (KRX) to develop its electronic bond trading platform in a 12-month project. The financial terms were not disclosed. The new...

UBS Taps Dark Pools.
February 12, 2007... UBS has come out with two algorithmic trading models that let clients move in and out of dark pools at will and match trades against the investment bank's large internal order flow--an average of 400 million shares a day in the U.S. and 200...

People In The News.
February 12, 2007... Veteran trading technology executive and FIX protocol pioneer James T. Leman joined consulting firm Westwater Corp. last month to head and build up its capital markets practice. Leman, who most recently was head of execution trading for the...

Enhancing Corporate Actions Data Management.
February 12, 2007... Financial institutions rely heavily on corporate actions data to make decisions. Yet management of this data is a messy business. Capturing notifications, verifying announcements and integrating and delivering essential data points are...

Shedding Light on Daylight Savings.(Daylight savings time )
February 12, 2007... Daylight savings time (DST), last adjusted in 1986, takes effect earlier and ends later in 2007. The Energy Policy Act of 2005, signed into law in August 2005, calls for the beginning of DST to be moved from the first Sunday in April to the...

Raising the Governance in Futures Markets.(Commodity Exchanges)
February 12, 2007... On Feb. 1, the Commodity Futures Trading Commission (CFTC) published guidelines for governance of futures exchanges--designated contract markets, or DCMs, in agency parlance--including provisions calling for 35 percent of board members to be...

Dow Jones Takes Its Wealth Manager Up a Notch.
February 12, 2007... If a Dow Jones & Co. brochure is any indication, the wealth management business today has the same kind of ring that "plastics" did in 1967 to the Dustin Hoffman character in "The Graduate." It's a ticket to riches, predicated on "a proactive...

Orc Connects to Canada's Pure Trading.
February 12, 2007... Stockholm-based trading and brokerage technology company Orc Software, which offers linkages to more than 100 markets around the world, said that connectivity will be in place for Toronto-based Pure Trading from its launch date March 9. Pure...

Technology as a High-Touch Aid.(Brief article)
February 12, 2007... John J. Bowen Jr., founder and CEO of market research firm CEG Worldwide, citing his firm's data, said the difference between being a traditional, transactional broker and a more client-centric wealth management adviser is the opportunity to...

Reference Data Role In Swift's Future: Messaging cooperative builds on its bank ID codes.
February 19, 2007... Expanding on its role in issuing identification codes for interbank messaging, the global Swift cooperative is developing a common reference data platform that will encompass payments, collective investment vehicles and standing settlement...

NYSE Bonds Close to Final SEC Approval: Timing of launch depends on imminent Rule 86 filing.
February 19, 2007... NYSE Group hopes to launch its revamped fixed-income platform, NYSE Bonds, by March, a knowledgeable source who requested anonymity told Securities Industry News. The exact timing depends on Securities and Exchange Commission approval of a...

How the Fixed-Income Platform Will Work.
February 19, 2007... NYSE Group's new fixed-income platform is designed to display, match and execute orders on a price-time priority basis. Orders will be matched and executed if, when entered into the system, contra-side interest is available at that or a better...

Portfolio Margining Rule From NASD Approved by SEC: Move is consistent with.
February 19, 2007... To the relief of clearing broker-dealers using NASD as their designated examination authority, the self-regulatory organization's (SRO) proposed rules for portfolio margining accounts were immediately approved upon their filing with the...

Credit Suisse Outsources Telecommunications: Five- to seven-year deal includes trading technology from BT.
February 19, 2007... In a radical shift from in-house management of its telecommunications infrastructure, Credit Suisse has decided to outsource its networking, trader voice technology and geographical provider relationships to Britain's BT Group and Zurich-based...

Nymex Looks North.
February 19, 2007... Nymex Holdings, parent of the New York Mercantile Exchange, said it and the Montreal Exchange plan to sign a strategic partnership agreement as early as next month that calls for Nymex to purchase a 10 percent stake in the Canadian financial...

GigaSpaces Raises $5 Million.(GigaSpaces Technologies)(Brief article)
February 19, 2007... GigaSpaces Technologies, a developer of high-capacity computer architectures for financial services, telecommunications and other industries, has raised $5 million in venture capital. The series C round was led by BRM Capital, with...

Intelligence Infusion.(StreamBase Systems financing round)(Brief article)
February 19, 2007... StreamBase Systems of Lexington, Mass., a leader in the complex event processing systems that underlie algorithmic trading and other sophisticated analytics in the investment community, reports that In-Q-Tel, the venture capital arm of the...

People In The News.(Reuters Group PLC appoints David Craig)(John Nixon joins The Clearing Corp.)(Iona Levine at LCH.Clearnet Group Ltd.)
February 19, 2007... Reuters Group chief executive Thomas Glocer has added a chief strategy officer, David Craig, to his senior team, taking on roles previously handled by Susan Taylor-Martin, now head of Reuters' U.K. and Ireland business. As a McKinsey & Co....

Hedge Fund Hero Ensnared.
February 19, 2007... Phillip Goldstein, the Pleasantville, N.Y.-based principal of Bulldog Investors, emerged as a hero of the hedge fund industry last year when he successfully challenged the Securities and Exchange Commission's attempt to impose a registration...

NYSE's Cases Against Deutsche Bank.
February 19, 2007... In a pair of disciplinary actions announced Feb. 8, NYSE Group's regulatory arm, NYSE Regulation, censured and fined Deutsche Bank Securities a total of $1.275 million (covered online at www.securitiesindustry.com at Breaking News). Of that...

Hartley Out at FISD, but MDDL Show Goes On.
February 19, 2007... James Hartley, chief scientist at the financial information services division (FISD) of the Software & Information Industry Association, left the Washington, D.C. organization last month on the eve of a new release of the market data definition...

Fixed Income a Draw to Daiwa's Clearing Services.
February 19, 2007... Looking for more personal service and the ability to clear fixed-income products, Wunderlich Securities recently started clearing through Daiwa Securities America, which after a five-year hiatus quietly reentered the business in 2004. ...

Capital IQ Upgrading With Debt and Credit Data.
February 19, 2007... Capital IQ said that it is announcing this week a broad-ranging platform upgrade to feed the hungry appetites of users of its Web-based financial information and analysis tools. The New York-based division of Standard & Poor's is...

Vhayu Fixed-Income Software on the Market.
February 19, 2007... Vhayu Technologies, a Los Gatos, Calif.-based provider of high-performance database and transaction processing software, has launched Vhayu Velocity for Fixed Income, which delivers real-time analytics and storage of critical fixed-income...

Dark Books in Search of Trade Volume: New order flow can be 'toxic,' requiring added controls and scrutiny.
February 19, 2007... As electronic, dark-book venues for executing block trades multiply, so do the buy side's concerns about the order flow interacting with their large trades, prompting the venues to devise a variety of ways to assuage those concerns. Market...

Variations on the Dark-Liquidity Theme.
February 19, 2007... As the number of dark books grows, and more and more seek to bring retail and algorithm-generated trades into their grasp, broker-dealers are weighing the execution benefits of those pools against the time and resources to connect to them. ...

Hedge Funds Drive Algorithmic Trading in Asia: Pattern from more-developed markets is repeating--with a time lag.
February 19, 2007... Despite limited infrastructure and liquidity and disparate regulations across Asia's geographical vastness, algorithmic trading has arrived in the region's emerging markets. Over the next two years, use of the technology is expected to increase...

Gaining New Advantages From Old Tools.
February 19, 2007... Block Interest Discovery Service (Bids) plans to begin operations in the second quarter, entering a crowded field of equity-execution venues with admittedly few new and different bells and whistles at its disposal. "All we're doing is taking...

Disaster Recovery for Hedge Funds: Tailored systems emerge; more choices at lower prices.(service introduction of Richard Fleischman Architects Inc.)
February 19, 2007... Falling storage costs, cheap bandwidth and strong data security are coming together to give hedge funds more--and more economical--backup and recovery options. The timing couldn't be better, as investors, regulators and basic business needs now...

Hedge Funds' IT Awakening Extends to STP.
February 19, 2007... In the five years since the Securities Industry Association--now the Securities Industry & Financial Markets Association--set aside its effort to accelerate equity transaction settlements from three days to one day after the trade date, the...

Inside Streetscape: Has Fidelity clearer's workstation broken the mold?
February 19, 2007... In the eyes of retail investors, Boston-based Fidelity Investments is the world's biggest mutual fund manager. But to financial services professionals, the privately held company is at least as well known for brokerage and clearing services,...

Northern Trust In Patent Bid for Cross-Border Pension Pools.
February 26, 2007... Northern Trust Corp. said that it has filed a request for a patent for a methodology it hopes will give it a competitive edge in servicing "tax-transparent" cross-border pension fund pooling vehicles. The filing with the U.S. Patent and...

India's Markets Aren't Merely Emerging: Stock trading fragmented, but sets high efficiency standard.
February 26, 2007... Before information technology brought India's stock exchanges into the modern era--when securities trades, in paper form, took 15 or more days to clear and some inevitably never got accounted for--there was Harshad Mehta. He was a small-time...

Boundaries Blur as E-bond Platforms Expand: Retail collides with institutional, scope is international.
February 26, 2007... In the beginning of the Internet bond trading era, about a decade ago, fast-moving technology pioneers would stake out a well-defined piece of product or market turf, letting others do the same in other parts of the vast fixed-income territory....

Forex Market Gets New ECN With FXall's Accelor: Exchange-like platform offers anonymity and low latency.(electronic communications network )
February 26, 2007... Foreign exchange trading portal FXall is announcing today the introduction of a service that it characterizes as an electronic communications network (ECN) for currencies. The system, already in operation for more than two weeks with a select...

One Interactive Data Brand.(Company overview)
February 26, 2007... Interactive Data Corp. said it is unifying the identities of three institutionally oriented business lines to "more effectively emphasize the breadth of its comprehensive range of products and services that can help customers further automate...

Milestone for SwapsWire.(Brief article)
February 26, 2007... London-based over-the-counter derivatives platform SwapsWire said it doubled its volume last year, handling more than 1 million trade events for the first time. The post-trade workflow servicer defines trade events as unwinds, option exercises...

People In The News.(appointment of Michael C. Bodson at Depository Trust & Clearing Corp.)
February 26, 2007... Depository Trust & Clearing Corp. (DTCC) has named Michael C. Bodson to the newly created position of executive managing director for business management and strategy, effective March 1. Reporting to president and CEO Donald F. Donahue, he will...

How Institutional Products Move to Mainstream.
February 26, 2007... Sputtering financial markets and increasingly demanding investors are triggering a shift in the financial services marketplace. Significant changes are already under way as today's global market structures mature and will take on a very...

A Shadow' Critique of Competitiveness, Futures.
February 26, 2007... Major financial institutions and marketplaces, trade association leaders and government officials have weighed in on the question of whether the weight of securities regulations is hindering the global competitiveness of U.S. capital markets....

Algos From Merrill, Others Target Smaller-Cap Stocks.
February 26, 2007... Merrill Lynch & Co., Jefferies & Co. and Tethys Technology are the latest firms to announce new algorithmic trading programs designed for small- and mid-cap equities. These issues can be a challenge for automated trading because liquidity or...

Large Institutions Push Growth in Japanese Automated Trading.
February 26, 2007... A much-anticipated rise in algorithmic and electronic trading is taking hold in Japan. It is confirmed in a recent report by Connecticut-based research firm Greenwich Associates and is being led by Japan's largest securities firms. Growth...

Finamex Adds Apama; Barclays in Orc Software Relationship.
February 26, 2007... Progress Software Corp. of Bedford, Mass. said that its Apama algorithmic trading platform has been selected by Mexican broker-dealer Casa de Bolsa Finamex to support electronic trading by buy-side customers. And in another international...

Deutsche Borse Turns to U.K.'s Colt for Hosting and Access.(COLT Telecom Group PLC)
February 26, 2007... Reacting to the surge in automated and algorithmic trading, Deutsche Borse has inked an agreement with Colt Telecom Group for collocation and hosting services and increased the bandwidth on its Xetra trading and market data platform. ...

Interwoven Goes Peer to Peer' for OTC Automation.(over-the-counter )
February 26, 2007... Document management software company Interwoven has unveiled what it describes as the first peer-to-peer network platform for reducing errors in communications between counterparties in over-the-counter derivatives transactions. The platform,...

Penson Keeps Door Open for Potential Acquisitions: Strong earnings and stock price fuel speculation, but nothing new to announce.(Penson Worldwide Inc.)
February 26, 2007... Making its first year-end earnings statement since its initial public offering, clearing services and technology company Penson Worldwide posted a 65 percent revenue increase for 2006, and its executives acknowledged that they are open to...