August 07 2015


 PLY: GMEX launches today – I wish the venture every success.elb2Exchange Invest Daily – the best bit is at the end of the week (and the final scroll), as Aesthetic Integration continue to consider markets intelligently. Elsewhere, BvB net profits tumble as volumes collapse while FXCM remains the forex broker of the walking dead. TMX worried about BOX, media continues berating ITG, suddenly perceive forex as a market platform issues (fair enough – even most practitioners didn’t appreciate that is on the horizon until 360T/Hotspot acquisitions). Quants heading to Bitcoin as EC announces April for OTC to CCP transition. And there’s more:

Public Markets

BVB H1 2015 Results


vs H1 2014: sales revenues RON 8.28 mln ($2 mln), down 37%, operating result RON 0.99 mln ($0.24 mln), down 83%, net result RON 3.96 mln ($0.98 mln), down 30%

PLY: It has to be said the BvB’s Press office went out of their way to deliver a confusing treatment of their results in this release, even by the low standards of cheap agitprop practised by some bourse groups as they accentuate any feasible positive at the expense of perspective.

FXCM Q2 2015 Results


vs Q2 2014: Total net revenues $60.5 mln, down 19%, Operating (loss) income $(11.1) mln vs $(1.9) mln, net loss $(151.2) mln vs $(8.1) mln

Read our Premium FX – CHF Crisis – Brief and FXCM Stakes Sales Brief.

PLY: Elsewhere, I see filming has just started for the last installment in the Milla Jovovich Resident Evil zombie movie series.

TMX Considers ‘Alternatives’ For Slumping Box Options Unit (subscription)

Eric Lam – The Globe and Mail

TMX is considering what to do next with Box, its slumping U.S. options exchange. Box’s share of U.S. stock-options trading dwindled to 2.4% in July from 2.8% a year earlier.

“Like every other asset around our portfolio, if we don’t think we can make it a growing, profitable business then we’ll have to look at alternatives,” TMX CEO Lou Eccleston said Thursday. “We’re watching it very closely.”

PLY: Hmmm, the once lively and revolutionary vision of BOX appears to have been diluted along the way and now is finding it difficult to stay afloat in a wildly packed options field.

Investigation Into Pilot Program Darkens Brokerage’s Outlook (subscription)

Bradley Hope & Sarah Krouse – Wall Street Journal

A pilot project by ITG, nicknamed “Project Omega,” was designed to improve trading, fend off competition and stem steady declines in revenue.

That was in 2010. Five years later, the in-house project has become an albatross that has led to a potential settlement with SEC over alleged trading improprieties and the removal of the company’s CEO, Robert Gasser.

Several clients have defected in the past week, say people familiar with the matter, and ITG shares have dropped more than 20%. Analysts have speculated about whether ITG may be sold.

More on this in our Premium service: “ITG, Dark Fines & a Coalition for Change.

PLY: Not a good week for ITG but I don’t share the pervasive media darkness. There is a lot ITG has done right and its equity Institutional Liquidity Pool has been increasing volume, especially through algo delivery.

Financial Stability: New Commission Rules On Central Clearing For Interest Rate Derivatives


Europe Moves To Cut Risk In $505 Trillion Derivatives Market

Will Hadfield – Bloomberg

… the European Commission said in a statement on Thursday.

PLY: Mandatory clearing from late April 2016, some worries about time to adoption and the rules emerging from the proces (rubber stamping required)  of the Brussels blob.

Exchanges Stake Out $5tn Currency Market For Next OTC Battle (subscription)

Philip Stafford – Financial Times

Exchanges are staking out the $5tn a day global currency market as part of their latest efforts to tap this lucrative and booming sector that has long been dominated by global banks.

PLY: Some background while as usual some incumbent OTC player remains in the shadows with an unattributable quotation pouring cold water on the inevitability of forex transition to transparent platforms (where BTW, the IDBs have considerable opportunity and incentive to profit).

Technical Preparations For Shenzhen-Hong Kong Stock Connect Done


Hong Kong, Shenzhen Stock Connect On Track, But Problems Linger (subscription)

Enoch Yiu & Jing Yan – SCMP

HKEx CEO Charles Li Xiaojia told reporters “the Hong Kong – Shenzhen stock connect is ready to go in the next three to four months” but said the launch time would ultimately be up to Beijing.

Read our Premium HKEx – SZSE Stock Connect.

China Funds Hold $161 Bln In ‘Ammunition’ To Re-Enter Stock Market


Close to 300 China funds that oversee more than 1 trillion yuan ($161.04 billion) are sitting on the sidelines with “ammunition” to enter the stock markets at any time.

Stock Markets Vex China’s Leaders

Yasheng Huang – NY Times

In 1992, Bill Clinton came up with the famous formula that won him the White House: “It’s the economy, stupid.” Chinese leaders have taken this approach to a stratospheric level. They feel a need to deliver economic miracles at all times and under all circumstances. This insistence on appearing to be omnipotent is among the reasons why the Chinese government allowed a stock market bubble to form and why it is now trying desperately to prevent it from bursting.

Read our Premium China Capital Markets Transformation Brief – Main File.

PLY: Clintonian economics have gone from Bill: “it’s the economy, stupid” to Hillary: “it’s the stupid economy,” At the same time, it is fair to say the Chinese leaders despite their Canute-esque current control predicament at least appreciate that the private sector can grow the economy and deliver job growth…

Stock Markets Steering Committee of Hellenic Exchanges – Athens SE


Friday, August 7th, 2015 – Existing shares now trading under their new par value of € 1.30 per share, ex-rights trading for the receipt of the capital return of € 0.11 per share, following the changes in par value of Hellenic Exchanges – Athens SE company shares. Record date for aforementioned corporate action: Monday, August 10th, 2015.

Private Markets

GMEX Counts Down Final Hours To Exchange Launch (subscription)

Alice Attwood – FOW

On Friday August 7 the futures market will see a new player enter the fray as GMEX goes live with its IRS CMF.

Bitcoin Startups Lure Quant Whizzes From Wall Street

Gertrude Chavez-Dreyfuss – Reuters

Armed with a doctorate in financial engineering, 34-year-old Timo Schlaefer was on his way to a promising career at Goldman Sachs in London…In February he gave that up, and launched a company called Crypto Facilities Ltd, a bitcoin derivatives trading platform, which now has six employees.

“This is uncharted territory,” said Schlaefer. “It’s an exciting opportunity to participate in a new area of technology that has massive potential.”

PLY: And a most exciting terrain it is too… Much more exciting than most folks realise – even those proclaiming expertise all of a sudden in electronic money…

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX is flat, FTIL down 1% after it’s leap yesterday.


Neptune’s Production Pilot Goes Live


PLY: In the final seconds before we went to pixel…interesting is all I have time to pith…

Bondcube CEO Makes Quick Return With New Venture (subscription)

Anna Irrera & Tim Cave – Financial News

The former CEO of Bondcube, the fixed income trading platform that closed in July, is ready for another go at helping source liquidity in the bond markets.

PLY: Fascinating stuff, a sort of closed network ECN for each broker dealer which can interlink to other pools – which in a way takes the vision of fintech back to Mr Market out of Hong Kong almost 20 years ago… Good luck to Paul Reynolds who clearly is fighting back already after the Bondcube closure…

Read our Premium post On Bonds & SEFs and Premium brief The Bond Platforms Rush Part 1, Part 2.


SGX To Launch Iron Ore Lump Derivatives

Commodities Now

SGX launched SGX Platts Iron Ore CFR China (Lump Premium) Swap and Index Futures contracts.

Career Paths

LSE announced that Massimo Tononi is standing down as a NED of LSE and Chairman of Borsa Italiana. Mr. Tononi has been a NED of Borsa Italiana S.p.A. and an INED of LSE since 2010, becoming Chairman of Borsa Italiana S.p.A., in June 2011.

FOW reports that ED&F Man has hired former Icap brokers Benjamin Chtromberg, James Sewell & Riki Haria to join its Dubai office.

Tokyo SE (TSE) and the Financial Services Agency (FSA) announced the establishment of the “Council of Experts Concerning the Follow-up of Japan’s Stewardship Code & Japan’s Corporate Governance Code”

Financial Calendar

All forthcoming exchange / investment related events are now listed in our Events page.

Share Notes

ICE Insider Charles A Vice, President & COO of ICE, sold 2,000 shares on Aug 4, 2015 at $230.44 (bargain $460,880.00).

Check our Share Notes section in our Premium service.

Analyst Notes

LSE “Hold” Rating Reiterated By Numis Securities

Liberum Capital Reiterated Their “Sell” Rating On ICAP

A full table of current analysis can be found on our Analyst Ratings page which is updated daily.

Other stories

‘Transparent Order Priority & Pricing’: Latest White Paper From Aesthetic Integration


PLY: Things worth waiting for – those who scroll to the end are rewarded by perhaps the best post of the week…


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